Auto Insurance Basics
Types of policies:
Bodily Injury Liability (BI) - Coverage for other people’s injuries that are determined to be your fault in an auto accident. Claims paid may include medical bills and lost wages. Coverage includes legal defense when there is a question regarding who is at fault.
Property Damage Liability (PD) - Provides coverage to pay for damage to someone else's property such as a car, mailbox, street sign, post office etc., that become damaged due to an at-fault auto accident. Coverage includes legal defense when there is a question regarding who is at fault.
Comprehensive Coverage - Also known as “Other than Collision” coverage. This pays for damage to your car (after you pay the deductible) for things like theft of your car, damage from a fire, flood, falling objects, vandalism and glass breakage to name the most common. Important to note, hitting an animal with your vehicle would also be covered by Comprehensive and not by Collision as most might assume.
Collision Coverage - Pays for damage you do to your car (after you pay the deductible) while driving, like running into another car, tree or building. It also pays for the damage to your car if someone hits you with their vehicle, even if it’s their fault.
Uninsured/Underinsured Motorist Coverage - Pays for medical expenses for your body and related expenses such as loss of wages and long term care, due to being injured in an automobile accident by someone else who does not have bodily injury liability insurance or does not have enough of it.
Medical Payments Coverage - Optional coverage that can be purchased with different limits, pays for medical bills and related expenses for you and your passengers regardless of who is at fault.
Other Optional Coverage(s):
- Towing & Labor - This coverage varies from company to company, but in general it should help to pay the cost of towing your vehicle when it breaks down and not just due to an accident. It may also include specific types of labor you may incur at the scene of the breakdown to get your vehicle running again. Due to large differences from one policy to the next be sure to read your own auto policy or consult with your agent regarding the details of the towing and labor coverage you are purchasing.
- Rental Reimbursement - Helps pay for a rental vehicle while yours is being repaired due to damage from a covered peril, so no you can’t use the rental reimbursement if your car is just in the shop for a few days getting maintenance.
- Gap Insurance - Pays the difference when your “upside down” on your leased or financed car. If you have a covered accident gap insurance will pay the off the balance when you owe more than your car is worth. This is especially good coverage for a new car
Specific to the State of Florida:
Personal Injury Protection or PIP - In Florida, everyone who has a personal auto insurance policy will have personal injury protection coverage which provides up to $10,000 for you (and sometimes your passengers and family members who live with you) for medical expenses and sometimes lost wages, when you are injured in a car accident. PIP will usually cover up for 80% of the medical bills up to the $10,000 limit. The limit for PIP can optionally be increased as can the percentage that medical bills are covered at (from 80% to 100%) through optional endorsements. Florida Law requires all motor vehicle operators to carry
Full Windshield Glass Coverage - You must have comprehensive coverage included on your personal auto policy to have your windshield covered in full without a deductible that you have to pay. A broken windshield can cost up to $800 for a standard car. Most insurance companies have an agreement with certain glass companies so that you can have your windshield repaired in your driveway or parking lot at work making getting your windshield replaced convenient.
Officers may exempt themselves from premium and coverage benefits by filing an exemption with State of Florida. Construction Industry may have no more than 3 exempt officers with each owning a minimum of 10% of corporation they are exempting themselves from.
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