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Friday, 10 May 2013

Commonly misunderstood auto insurance terms

Because your insurance providers are typically doing their best to make your coverage as customizable as possible in order to best meet your needs, there exist several terms for any given type of insurance that indicate such customizations. Auto insurance is no exception. It can be overwhelming for a shopper to try and sort out exactly what these terms mean, and how these terms apply to them if hearing these phrases for the first time. Familiarizing yourself with these terms before you start your auto insurance shopping will give you confidence in your decision making, and will help you to make choices that are best suited to you.

Collision coverage is what funds the cost of repairing your vehicle in the event of a car accident (whether it involved another vehicle or not).

Comprehensive coverage is what funds the cost of repairing your vehicle in the event that it sustains damage from a cause that is not owing to an accident (such as natural disasters, inclement weather, theft, or vandalism).

Personal injury protection covers the cost of medical care (for expenses beyond AHCIP coverage) as well as lost wages for the injured party, regardless of who was at fault.

Medical payments coverage covers a variety of things: it covers expenses (particularly medical and funeral expenses) to you and your family if they are hit as pedestrians, and also covers these expenses if you or your family are involved in a motor vehicle accident.

Liability coverage is what gives you protection in covering the injury or damage you cause to others with your vehicle. There are two types: bodily injury liability, and property damage liability.

Bodily injury liability covers you in the event that you cause injury to others with your vehicle. The expenses it encompasses include lost wages, medical expenses, as well as personal damages. Because these expenses can add up significantly, this is an important type of coverage to have; otherwise, you risk losing everything you own in a lawsuit.

Property damage liability covers you in the event that you cause damage to another's property with your vehicle. That property includes another vehicle, a home (as well as the structures surrounding it), a store, and so forth.

Uninsured motorist coverage takes care of you and your passengers in the event that you are the victims of a hit-and-run, or of an accident in which the other party is uninsured. Any losses you sustain as a result of such an incident are covered by uninsured motorist coverage.

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