When I began working here at Comstock I thought I knew how to read my auto insurance policy – assumed I knew. It didn’t take long for me to realize that reading it was one thing, but understanding it? An other thing all-together. Following some intense insurance-y research, I am at the place of enlightenment.
Set your mind to stunned as I walk you through complete knowledge and understanding of your Auto Liability Insurance…
The Basic-3 of Every Auto Policy
- Liability insurance for bodily injury
- Liability insurance for property damage
- Uninsured/Underinsured bodily injury
Bodily injury liability (BI) applies when you cause an accident where the injuries are a result of your negligence. It protects you against claims for damages. Things like: medical expenses, lost wages, and pain & suffering. It’s important to remember that this coverage does not protect you or your auto directly.
Example: 100/300 = Coverage up to $100,000 per person in the vehicle for a single accident and coverage up to $300,000 in total for a single accident.
Property damage liability (PD) pays for damages caused by you to the property of others such as damage to another vehicle, fence, or tree caused by collision. It also pays for your vehicle when you require comprehensive or collision coverage. These coverages are listed on your policy and state your deductible amount to access them.
Collision is defined as physical damage to your vehicle when it collides with an object, such as another car, or a tree. These are things you can reasonably control.
Comprehensive is defined as damage from nearly all other losses not listed under collision. Including: theft, fire, vandalism, weather losses including, hail, flood, falling objects, damage caused by bird or animal, and broken glass. These are things you most likely cannot control.
Uninsured Motorist (UMBI) is bodily injury coverage that directly protects you. It pays if you are injured by a hit-and-run driver or a driver who doesn’t carry auto liability insurance. It essentially covers you in place of the liability insurance that the other driver failed to purchase.
Underinsured Motorist (UMBI) is also bodily injury coverage that pays when the other driver is at fault, but their limits are lower than your damages and/or injuries. UMBI steps in to pay any additional amounts up to your limits.
A good rule of thumb when deciding on your UMBI is to match your BI limits. Think about it this way: the required BI limits are to protect the other guy when you’re at fault and UMBI protects you when they’re at fault and underinsured.
Medical Payment (Medpay) is no-fault payment for you and others injured or killed in an accident while traveling in your car. It pays for medical and funeral expenses and extends out to you if you are struck by a vehicle as a pedestrian. Read here for more about the benefits of medpay.
Towing or roadside service pays up to your policy limit for towing your car to a repair shop.
Rental Reimbursement pays for a rental car in the event that your vehicle is damaged by a loss that is covered. Generally, it is a daily balance and a total maximum.
Example: $50 a day up to $1,500. Side note: Does the rental car counter give you the jitters? Get over it by reading: here.
Need more help understanding your auto policy? Call us! The more you understand your coverage the better you’ll feel about your hard earned dollars spent on insurance.