I have already talked about the most misunderstood coverages on an auto insurance policy. Today I am going to hit on several different coverages that are a little easier to understand (but I didn't want to leave them out!)...
Comprehensive and Collision Coverage
Comprehensive Coverage pays to repair or replace your vehicle if something were to damage it by other than collision. A few examples would be that your car was stolen, hail damaged it, or your windshield cracked. Those are generally covered by your Comprehensive Coverage.
Collision Coverage pays to repair or replace your vehicle if someone hits your vehicle and doesn't have insurance, or if you hit someone and are at-fault. Both Comprehensive and Collision Coverage come with a choice of deductible, which is money you pay out-of-pocket when your insurance company pays a claim. The deductibles usually range from $0 - $1500. (But in Florida, if your windshield gets chipped or cracked and you have Comprehensive Coverage, the deductible is waived!)
Something to remember with both of these coverages is that if your vehicle is totaled, the company will give you what they deem your vehicle is worth. There is very little wiggle room in the number they give you. So if you have the opportunity to purchase Vehicle Replacement Coverage, it might be worthwhile to ask how much it costs to add it to your policy.
Medical Payments is a coverage that goes towards medical expenses as a result of an accident. Medical Payments pay your (and your passenger’s) medical costs up to the limit you carry, regardless of fault. They can help pay funeral costs and even dental costs if someone incurs damage to their teeth as a result of an accident. Medical Payments Coverage is pretty straight forward, but surprisingly, a lot of people don't carry it. It can be a great coverage to have if you get hurt in an accident, and it's a pretty inexpensive coverage.
This one is pretty self-explanatory. Most companies offer either Towing or Roadside Assistance. Just make sure you understand what you are buying. Some companies actually have a Roadside Assistance crew with tow trucks and such that will assist you. Other companies will reimburse you for your costs incurred due to needing Roadside Assistance or needing a tow. Towing Coverage usually means that the insurance company will reimburse your for needing a tow up to a certain amount. So that means you will pay for a tow, and then submit your receipt to the insurance company, and they will reimburse you for your tow up to the amount that the policy allows.
Loan/Lease Payoff or Gap Coverage
Gap Coverage will pay off the difference between what you owe on your car and how much your insurance company will pay out in the even your vehicle is totaled. In some cases, Gap Coverage will even pay your deductible on your car insurance policy as well.
Loan/Lease Payoff Coverage will usually pay up to 25% of the actual cash value of your vehicle. So if you were to total your car and your insurance company were to pay $20,000 for the totaled car, you would receive up to an additional $5,000 towards paying your car loan off.
I hope this blog series has been helpful! If you just stumbled upon this post, you can read the others here:
Read part one (Personal Injury Protection) here.
Read part two (Bodily Injury Liability) here.
Read part three (Uninsured Motorist Coverage) here.
Read part four (Property Damage) here.
If you have any additional questions regarding your car insurance policy, or you're looking for an insurance agent in Kissimmee, feel free to email me or message me on Facebook or Twitter.