AUTO INSURANCE ARTICLE
What Does Your Auto Insurance Cover?
By: letter_womanAuto insurance is important because it protects you and your car from harm’s way. In case of accidents, damages or vandalism on your vehicle, auto insurance is there to bear the costs for such unexpected expenses. Auto insurance is therefore a way to protect your and your family’s lifestyle, your family finances, and your mobility. But not all auto insurance policies are the same. And not all auto insurance policies have the same coverage. But when you buy an auto insurance, it is better to know that the following are the basic coverage:
Third Party Liability Coverage: If by operating your vehicle you become responsible for someone else’s losses, and you are sued and found to be responsible for injuring or killing someone or damaging someone’s property, your insurance company covers you a maximum amount that covers the legal settlement or court award against you. If you are sued for both injury and property damage and the total claim is more than your maximum amount coverage, your insurance company will pay a fixed amount for the property damage portion. However, if you did not sign up for an auto insurance and you were sued, you need to pay the damages yourself. You cannot apply for an auto insurance and have it cover past damages, accidents or losses.
If you are injured in a car crash you can claim the following benefits, regardless of who is responsible:
If you need medical care, your insurance company will pay your medical bills, up to a certain amount per person, including the cost of rehabilitation. Generally, your auto insurance will pay only after any other health insurance plans have paid. In some policies, you can also claim up to a certain amount for payment to a caregiver while you are recovering from your injury. See also the provision for “catastrophic” injuries.
If your injury causes you to miss work, your auto insurance company will pay you a portion of after-tax wages, up to a maximum weekly payment, for up to a number of weeks, if you are disabled. There may also be a provision on the pay-out rate if you were unemployed prior to your injury and are in difficulty to carry on your usual routines.
If you die in a fatal car collission, and you do not qualify for income replacement benefits, your family is entitled to a sum of money, regardless of who is responsible.
But as is mentioned, not all auto insurance policies are alike. But generally, these minimum coverage are what insurance policies offer. You may choose to buy additional auto insurance coverage to cover theft, vandalism or other damage to your car. You also have the option to buy higher limits on some of the coverage listed above, such as Third Party Liability and Accident Benefits.
To know what is and isn’t covered with the minimum amount of insurance that you are planning to sign up for, talk to your insurance agent. And remember to read beyond the fine print. Don’t hesitate to ask and clarify.