How to Know Your Car Insurance Covers What You Need

Car insurance

Here are six areas to review with your insurance agent so you know if your car insurance covers what you need it to.

1. What is …

  1. What is the amount provided for medical payments and personal injury payments?
  2. What is the difference between cancellation and non-renewal of a policy?
  3. What is the difference between liability, comprehensive, collision, and full coverage insurance in terms of financial costs and also in terms of the extent of coverage?
  4. What is included on an umbrella liability policy and when do I need one?
  5. What is Personal Injury Protection and how do I know if I need it?
  6. What is a deductible?
    1. Is this a reasonable amount?
    2. What is the national average for this?
    3. What is the state average for this?

2. Who or What is Covered?

  1. Who is covered under this policy? Are other licensed drivers (friends, family members) covered if they drive my car? Does this cover what I need?
  2. What are the different levels of coverage available for my car’s make and model, and for my family situation?
  3. How do I insure my teenage driver? What factors can reduce or increase the cost of his/her insurance?
  4. If I use my car for my business, is it covered under my policy?
  5. Can I take cars on and off my policy? For instance, if I have a car I only drive in the summer, can I put it on insurance for only June, July and August? What kind of lead time does the insurance company need?
  6. Does the policy include roadside assistance?
    1. If not, does the company offer it, how much is it and what geographic areas does it include?
    2. Are there certain times that are/aren’t included?
    3. Are there services that are/aren’t included?

3. Uninsured, Licensed, Non-Licensed Passenger, Driver

  1. Are other licensed drivers covered if they drive my car?
  2. What about non-licensed drivers?
  3. Are passengers covered? For how much? Is that amount enough/does it fit with recommended averages by your firm?

4. Rental and Leased Vehicle

  1. Are leased or rented vehicles covered under this policy?
    1. If I choose not to add this coverage, do I need to get insurance that a rental car company offers when I rent a car?
  2. Does this insurance policy cover me anywhere in the country? What about outside of the country?

5. Accident, Damaged, Stolen

  1. Are personal items in the car covered in case of an accident or theft? Do I need a rider on certain items if I’d like that option?
  2. If I am in an accident, does the policy include legal fees if I have to go to court? If not, how is that paid for? Is that an additional charge?
  3. In your experience, if my vehicle is damaged, how quickly can I expect to see an adjuster?
  4. If the adjuster determines that the car is repairable, can I choose to take a check (less than my deductible)?
  5. If my car is damaged or stolen, will the policy pay for a rental vehicle until I get my car back?
    • Does this policy offer a percentage or full reimbursement?
    • If not, how much more does it cost to get that?
  6. Am I covered if the damage to my car was due to an uninsured or under-insured motorist?
  7. If my car is damaged as a result of a non-collision event (such as a fire at my home or natural disaster), is it covered?
  8. What situations DOESN’T my insurance cover? Is there something I’m missing?

6. How Much…

  1. How much insurance do I need if I have one car, two cars, etc.? Does this cover what I need it to?
  2. Tell me where I fit in with national averages – am I paying average, more, or less, and what factors into your answers?
    • Are there certain models of car that cost more to insure? Do I have one?
    • What vehicles get the lowest insurance rates?
  3. If I owe money on my car, does that affect how much insurance must I carry?
  4. If I have a lower deductible, how much are my payments? With a higher deductible, how much are my payments?
  5. What are my payment options? Annual payments, bi-annual, monthly, etc.?
  6. What coverage is available for a “basic” auto policy? How much is that?
  7. What is the breakdown of the benefits I have?
  8. How much will it be to insure myself at the level I’m comfortable with?
  9. What factors increase policy cost?
  10. What can I do to decrease the cost of my policy? (Have a safe driving record or increase the deductible, for example.)
  11. What discounts do you offer? (Many insurance companies offer a discount if you insure multiple cars with them, or have multiple policies, i.e., home, theft, auto, business, etc.)
  12. What does my zip code have to do with my car insurance?
  13. What is the length of time that the policy is in effect?
  14. What can result in the policy being canceled or premiums raised?
  15. What do I do if can’t get insurance through traditional private insurance companies?

Also – talk with friends about their insurance company, their agent, and their experiences.

Photo Credit: edar

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