Thursday, May 9, 2013

Many Types Of Coverage In The Auto Insurance Industry

There are many types of coverage in the auto insurance industry. It is important each consumer know what these coverage's mean so they know what they are purchasing. No one wants to get stuck with too much or too little coverage and knowing what it all means is a good place to start.

Liability insurance is the base for all auto policies and is required for all drivers in California. Liability coverage can protect the consumer from lawsuits that may arise from an at fault claim. It will cover another parties medical bills as well as the property damage to their vehicle. Every auto policy has some form of liability coverage.

Medical payment coverage pays the cost of needed medical coverage up front to anyone involved in an accident, regardless of fault. Medical payment coverage is limited to a dollar amount. In some cases it may not apply until other sources of insurance have run out, but this varies from state to state.

If the person at fault in an accident does not have insurance, there may be very little the consumer can do to get reimbursed for damages to their vehicle and person. Luckily there is uninsured motorist. UM will pay out for the consumers' medical bills as well as damages to their vehicle, then the carrier will pursue the at fault driver in court for reimbursement.

Rental car reimbursement will reimburse the consumer for the amount spent on a rental car if their insured vehicle is covered under comp and collision and is involved in a claim. There is a limit to how many dollars total can be spent on a rental car and still receive reimbursement.

Collision coverage will pay for the repairs on a consumer's vehicle (minus deductible) if it is involved in an at fault accident. The easiest way to avoid this is to simply not get into a wreck. However, just to be save, collision coverage is always good to have!

Comprehensive coverage will pay for the repairs to a consumer's vehicle (minus deductible) if it sustains damage from an act of nature, vandalism or theft.

Ultimately, there are many different coverages and most you do not know the definitions for, this is why we have written this extensive article to help you understand exactly what type of coverage you are getting before you purchase it.

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