What exactly does my auto insurance cover?

What exactly does my auto insurance cover? 

I’m so confused…what exactly does my auto insurance cover?  Deductibles, limits, blah, blah, blah… please explain in simple language how my auto policy works!

Oh man, I just had an accident, I have no clue where to even begin…

Let’s look at the following scenario: "A dog ran in front of my car at a yellow light. Trying to avoid the animal, I swerved into the other lane and side swiped a really expensive car on the side of me (well, at least it was worth a lot before I hit his car!), then I came to a stop, but not before hitting a telephone pole where I damaged my car. The guy that I swiped seemed to be fine, but decided to go to the hospital to be checked as a precaution. And “OUCH, my back is killing me!”

First, file a claim with your insurance company…

So now you have reported your claim to your insurance company. This is how your specific policy works, based on the damage you incurred.

The guy in the “expensive” car that you swiped: With your bodily injury (BI) liability coverage or the other driver's personal injury protection (PIP) coverage…

This is what generally takes place: The local police department files an accident report based on the facts of the accident. You were found “at fault” (sorry, the dog does not have insurance).

You can be held responsible for the third party medical expenses. BI (bodily injury) is required in most states. The insurance company that covers you would generally pay up to the per-incident limit in this case. Certain states are considered “no fault” states, and personal injury protection could cover medical care of the driver and passengers up to the limit that each state would mandate.

“I need a Dr. for my back pain”:

What covers this is called No Fault, aka Personal Injury Protection (PIP) coverage, or Medical Payment Coverage, depending on your state of residence. This coverage can work with or in place of your health insurance to help cover the costs of your post-accident medical care.

The telephone pole: Property damage (PD) liability coverage; property damage insurance covers repairs to other cars and property up to your policy's limit when you're at fault.

Your car: Is covered by Collision Coverage

Remember that liability coverage pays others for their damage. Collision Coverage can help pay to repair your own car damages. Collision insurance pays for repairs, less your deductible, usually up to the cash value of your vehicle.

Do I have to pay to have my car towed?

You can purchase optional Emergency road service (ERS). If you have purchased this low cost benefit, you just call the emergency number on your ERS card provided with your policy, and your car will be towed to a shop for repair. The insurance company will pay for the towing expense up to the policy limit purchased.

My car is in the shop…and I have to rent a car

You can purchase Rental Reimbursement coverage. This is another low cost premium that will be handy to have should you have an accident.

Ask your agent for details and options available before finalizing your insurance needs. Should you experience a claim, InsuranceTrak can guide you through the process of the initial reporting and everything that follows.

By Craig Bruno

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