Buckle Up

Buckle Up

As you know by now, our goal for The $ense is to share important, relevant, articulate and sound financial guidance.  While we strongly encourage you to heed each and every delicious morsel of our advice, the reality is… it’s optional.  That is, until we talk about auto insurance.  When it comes to insuring your car, it is required by law that you purchase at least some coverage.  So, we feel safe in making the assumption that you have auto insurance.  We also feel pretty safe in assuming that, unless you are an insurance agent, staring at your declarations page will do little to help you understand what it means or if you have the proper amount of protection.  So, instead of recommending that you get coverage (we’ll rest on the law for that), we’ve created the chart below to help you decode your existing coverage and determine if it’s enough.

What You Want to Know…

Look at Your…

Make Note of…

And, Ask…

What covers physical damage to or theft of my car?

Collision Coverage and Comprehensive Coverage

  • Collision coverage is provided if damage is incurred in an accident.  This will be required by a lender.
  • Comprehensive coverage covers damage or theft, outside of an accident.
  • Do I need GAP insurance to pay the difference between what my insurance company will pay and what I owe on a loan or lease?
What covers injury or damage I caused to others?

Bodily Injury Liability/Property Damage Liability Coverage

 

  • Minimum coverage is required by state; amounts vary.
  • Bodily Injury Liability coverage provides for injury-related expenses such as medical, legal, loss of income, pain and suffering and funeral incurred by a covered, injured person.
  • Property Damage Liability coverage pays for damages to the other party’s car or property.
  • Coverage may be illustrated as: 100/300/50, which is: Single person’s injuries/Total injury limit per accident/Limit on property damage.
  • Is your coverage sufficient to cover injury-related expenses in your area?  Consider potential loss of income and pain and suffering.
  • Is your coverage high enough to cover the value of the types of cars you see on the road?
What if the other driver doesn’t have insurance? Uninsured/Underinsured Motorist
  • May be required by state.
  • Covers injury expenses incurred by you (and passengers) if you are hit by a driver with inadequate coverage, no coverage or a hit-and-run.
  • Additional coverage may be added to cover property damage to your car (recommended).

 

  • Is your coverage at least as high as your other liability limits?
What if I need to cover medical expenses and my health insurance company is taking too long? Medical Coverage
  • Available regardless of who is at fault and no deductible is required.
  • Access to funds can come in handy to cover a gap between medical claims and approval by your insurance company and, if sufficient, can help save on required health insurance deductibles.
  • Is coverage sufficient to at least cover your health insurance deductible?