By Marcus Fernandez
“But, I had full coverage!” This is probably the most widely held belief of new callers and clients that we encounter. More often than not, however, there is a big gap between the type of auto insurance coverage that they think they have and the insurance coverage that they actually have.
The truth is that there are so many types of auto insurance coverage available that even if you had all of them – it still would not be accurate to say you have “full coverage.”
My own disclaimer: The following is not intended to be a fully comprehensive explanation of auto insurance coverage. A number of factors including how many vehicles you have, the number of drivers and family members in your home, your elected coverage and terms of your policy can impact how your case is handled.
Mandatory Insurance Coverages
Let’s start with mandatory auto insurance. In Florida, you are required to carry two types of auto coverage: Personal Injury Protection Coverage (often called PIP coverage) and Property Damage Coverage.
Personal Injury Protection coverage is in place to help ensure that every driver can have medical needs addressed immediately, regardless of fault. Florida is one of 12 states that are often referred to as a “No Fault State,” meaning that you can immediately access your PIP benefits without having to go through the courts system. PIP benefits can help cover medical bills, work missed due to injury and even funeral expenses.
The other type of mandatory coverage is Property Damage Liability Coverage, or PD. This coverage is used to help pay for any damage that you cause to someone else’s property, including damage to another vehicle, building or structure. It’s important to note that this insurance will only pay for property belonging to another individual, and will not cover damage to your own vehicle.
Because Personal Injury Protection and Property Damage coverages are the only two required by law, anyone who has them is considered to have “full coverage.” However, there are a number of additional coverages you should consider in order to help protect you and your family in the case of an accident.
Additional Insurance Options
Bodily Injury Coverage/BI Coverage
Bodily Injury Coverage/BI Coverage protects your assets if you cause injury to another person while using a motor vehicle. Coverages in this area are typically limited per person and per accident (usually represented by two numbers). For example, a $25,000/$50,000 policy means the most your insurance company would have to pay to any one person would be $25,000, and the most they would have to pay out to all injured persons combined is $50,000.
Underinsured/Uninsured Motorist Coverage/UM/UIM Coverage
Underinsured or Uninsured Motorist coverage protects you if you get into accident with a person who was either uninsured (they did not have any bodily injury coverage), or underinsured (where injuries and damages exceed the amount of bodily injury coverage held by the other party). I could spend this entire article writing about the intricacies and benefits of UM/UIM coverage. It is by far one of the most important types of coverage to have.
Collision Coverage pays for repairs to your car in the case of an accident. If your car is a total loss, meaning the cost to repair exceed the value of the vehicle, collision coverage will pay the total value of your car. It’s important to note the discrepancy. If you owe more on your car than it is worth, you may not receive payment for the full amount owed.
Comprehensive Coverage protects you if your car is damaged by something other than an auto accident. For instance, comprehensive coverage is used to pay for damage caused by natural disaster, if you hit a cow, or if your car is stolen.
Do you know what you’re covered for? Check your insurance policy, or contact your agent to review your coverage. If you’ve been in an accident and are dealing with the aftermath of inadequate coverage, contact our office so that we can review your case and provide you with a complimentary consultation.
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