How Well Do You Know Your Auto Insurance Coverage?

Let’s face it, unless insurance is your business you may not be the one-stop expert on questions relating to coverage. For those of us who aren’t experts — say a personal injury and liability attorney, perhaps — our insurance policies may largely unfamiliar. This is the same case regardless whether it’s health insurance, home or auto insurance.

But it’s important to have some idea of your insurance coverage, should an event ever arise requiring insurance coverage. This is especially true for auto insurance, as the average person is more likely to experience the auto insurance claims process more commonly than health or property.

It’s a goo idea to understand exactly what is covered under your policy and, most important, what you are required to pay.

Here are 10 key terms as they relate to your auto insurance policy that you need to make sure you understand.

Collision

Collision coverage pertains to coverage from damage to your vehicle in the event of an accident, regardless of who is at fault.

Comprehensive

This type of coverage will get you compensation for to damage to your vehicle from a collision with anything other than another vehicle.

Deductible

Your deductible is what you pay out-of-pocket BEFORE your insurance coverage kicks in. Your monthly premium can be higher or lower depending on whether you elect to pay a high deductible or not: higher deductible means lower premium and vice versa.

Declarations

Your declarations page is essentially your insurance policy, in summary form. The declarations page will give you an overview of your policy and vehicles covered.

Full Coverage

This one is a bit of a misnomer; nobody can be fully covered from any unforeseen event. Full coverage as it pertains to your auto insurance just indicates that your policy has more than basic liability.

Gap Insurance

Gap insurance really only applies if you’re leasing or financing your vehicle. Essentially, gap insurance will cover the difference in your vehicle’s natural depreciation and the amount you’ve paid down in the event of a total-loss.

Liability

Liability is the mandatory minimum requirement you need for auto insurance. Liability insurance will cover damages and injury to another driver if you are at fault. It does not cover any expenses you might incur.

There are two types of liability coverage:

  • Bodily injury liability insurance
  • Property damage liability insurance
No-Fault

Florida is one of the 16 “no-fault” insurance states. No-fault insurance means that your insurance provider will help pay injury benefits regardless of who is at fault.

Personal Injury Protection

Personal Injury Protection (PIP) is a basic requirement in Florida and other no-fault auto insurance states. PIP will cover expenses for essential services should you become injured in an accident and unable to generate earned income. PIP can be applied toward medical expenses, lost wages and even funeral costs.

SR-22

You will need an SR-22 if you have ever had your license suspended, temporarily revoked, or you have a history of high-risk driving. A SR-22 serves as a Certificate of Responsibility and basically acts as your proof of insurance as a high-risk driver.

Additional Resources

To find out more about Florida’s auto insurance requirements, click here. If you want to find out more information about the insurance claims process or recouping losses due to an injury, contact our team.