Auto Insurance And Pre-Coverage Damages: What's Covered?

Auto insurance is a legal requirement for drivers in most states. It covers injuries and property damage caused by the policyholder in the event of an accident. While auto insurance policies vary, they typically include liability insurance, which covers expenses relating to another person's injuries and property damage. Collision insurance covers damage to the policyholder's vehicle from a collision, and comprehensive insurance covers non-collision-related damage, such as vandalism, fire, and theft. Auto insurance does not usually cover pre-existing damage or maintenance.

Comprehensive insurance covers non-collision damage, like vandalism, fire, falling objects, and theft

Comprehensive insurance is an optional coverage that protects your vehicle from damage caused by non-collision events outside your control. It is often required by lenders if you are leasing or financing your vehicle. Comprehensive insurance is also known as "other than collision" coverage, as it covers incidents that collision coverage does not.

Comprehensive insurance covers damage to your car from:

• Vandalism
• Fire and explosions
• Weather and fire damage
• Falling objects
• Theft
• Accidents with animals

For example, if a tree falls on your car during a storm and causes damage, comprehensive insurance will cover the cost of repairs. If you swerve to avoid a squirrel and hit a fence, your comprehensive coverage will pay for the damage to your car, and your liability insurance will cover the damage to the fence.

Comprehensive insurance is a great way to ensure you are covered for any unexpected events. It is important to note that comprehensive insurance does not cover damage caused by hitting another vehicle or object, as this is covered under collision coverage.

Collision insurance covers damage to your vehicle from a collision, whether or not you are at fault

Collision insurance covers damage to your own vehicle from a collision, whether or not you are at fault. This includes collisions with other vehicles, objects such as a lamppost or a mailbox, or even if you roll your car. It also covers damage caused by uninsured or underinsured drivers.

Collision insurance is distinct from liability insurance, which covers damage to other people and their property. If you are found at fault in an accident, your liability insurance will cover the damage to the other driver's car. However, liability insurance does not cover damage to your own vehicle. That's where collision insurance comes in. It will pay to repair or replace your car after a crash, regardless of who is at fault.

It's important to note that collision insurance does not cover damage to personal belongings inside your car or medical costs from injuries to yourself or your passengers. Additionally, collision insurance will not cover car damage from non-traffic events, like running into a deer, extreme weather, or theft. For coverage of these types of incidents, you would need comprehensive insurance.

In some cases, collision insurance may be required. If you finance or lease your car, your lender or leasing company will likely require you to have collision coverage. Even if you own your vehicle outright, collision insurance can provide peace of mind, especially if you drive an expensive car or cannot afford repairs after a crash. Ultimately, collision insurance helps protect your investment and gives you financial protection in the event of a collision.

Liability insurance covers damage to other people and their property

Liability insurance is an insurance product that provides protection against claims resulting from injuries and damage to other people or their property. It covers the legal costs and payouts for which the insured party would be found liable. In the context of auto insurance, liability insurance covers damage to other people and their property in the event of accidents. This includes medical expenses, pain and suffering, loss of income, and legal fees if the policyholder is sued.

In the United States, drivers are required to have some way to pay for any damages they cause. This is typically achieved through liability insurance coverage on their vehicles. Most states mandate that vehicle owners have a minimum amount of liability insurance under their auto insurance policies to cover injuries to other people and property damage in accidents. This is often referred to as third-party insurance.

Liability insurance for auto insurance usually consists of two primary types of coverage: bodily injury liability and property damage liability. Bodily injury liability covers costs related to injuries or death caused by the policyholder or other insured drivers to another person in an accident. This includes medical expenses, such as emergency room bills, prescriptions, necessary over-the-counter medications, and medical devices. It also covers lost income due to time missed from work for physical recovery and medical appointments. Additionally, liability insurance covers pain and suffering, as well as other non-economic damages like scarring and loss of enjoyment of life.

Property damage liability, on the other hand, pertains to the costs associated with damage caused by the policyholder or someone driving the insured vehicle to someone else's property. This can include not only other vehicles but also buildings, utility poles, fences, and any other property damaged in an accident.

It is important to note that liability insurance does not cover the policyholder's injuries or damage to their own vehicle. These are typically covered under different parts of an auto insurance policy, such as collision and comprehensive coverage. Collision insurance covers damage to the insured's vehicle from a collision, regardless of fault. Comprehensive coverage, meanwhile, pertains to non-collision-related damage, such as vandalism, fire, explosions, falling objects, weather-related damage, animal damage, and theft.

Uninsured motorist coverage protects against drivers without insurance

Uninsured motorist coverage is a type of car insurance that offers financial protection in the event of an accident caused by a driver with insufficient or no insurance. This coverage is essential, especially considering that nearly 13% of drivers countrywide are uninsured, with some states having over 20% of drivers on the road without insurance.

Uninsured motorist coverage can be broken down into four main types:

• Uninsured motorist bodily injury (UM or UMBI): This covers medical expenses for you and your passengers if you're in an accident caused by an uninsured driver. It may also cover lost wages, pain and suffering, and funeral expenses.
• Uninsured motorist property damage (UMPD): This covers repairs to your car and property damage if it's hit by an uninsured driver. In some states, UMPD can also be used for hit-and-run accidents.
• Underinsured motorist bodily injury (UIM or UIMBI): This type of coverage pays for medical expenses and other costs when the at-fault driver doesn't have adequate insurance to cover all your bills.
• Underinsured motorist property damage (UIMPD): UIMPD covers damage to your car if it's hit by a driver who doesn't have enough liability insurance.

The cost of uninsured motorist coverage varies, but on average, it's around $136 per year. While not all states mandate this coverage, it is highly recommended for all drivers. Without it, you could be left paying for medical bills and vehicle repairs out of your own pocket.

Underinsured motorist coverage protects against drivers with insufficient insurance

Underinsured motorist coverage is a type of auto insurance that protects you if you're in an accident caused by a driver with insufficient insurance coverage of their own. In general, if the at-fault driver's policy limit is lower than the cost of the damage to your vehicle or your medical bills, and you have underinsured motorist coverage, your insurance company will cover the remaining amount.

Underinsured motorist coverage is different from uninsured motorist coverage, which covers cases where the at-fault driver has no insurance at all. Uninsured motorist coverage protects you if you're hit by a driver who has no auto insurance. In contrast, underinsured motorist coverage is designed for situations where the at-fault driver doesn't have enough insurance to cover all the damages.

Underinsured motorist coverage typically includes two parts: bodily injury coverage and property damage coverage. Bodily injury coverage takes care of medical bills and may cover lost wages, while property damage coverage takes care of the cost to repair or replace your vehicle. However, in some states, only bodily injury coverage is available for underinsured motorist claims.

Underinsured motorist coverage is required in some states, such as Connecticut, Kansas, Maine, Maryland, Minnesota, Nebraska, North Carolina, North Dakota, Oregon, South Dakota, and Vermont. In other states, it is available as an optional endorsement on an auto insurance policy. Even if it is not mandatory in your state, it is highly recommended for all drivers to have underinsured motorist coverage to protect themselves financially in case of an accident with an underinsured driver.

The cost of underinsured motorist coverage is generally lower than other types of car insurance. However, if you increase the coverage limits, you will pay more. It is common for drivers to set their underinsured motorist limits at the same level as their liability limits to ensure adequate protection.

Frequently asked questions