Does Your Auto Insurance Fully Cover You for Personal Injury Claims?
As most people know, there are numerous types of insurance policies. However, not every knows that within a standard automobile policy there are difference coverage’s that may apply to you, and/or your family, if you are involved in a motor vehicle accident.
Standard automobile insurance policies in Texas pay for certain damages and losses specifically covered by your policy. Many insurance companies use the Texas Personal Automobile Policy, a standardized policy form that offers the following eight types of coverage’s depending on what you purchase:
- LIABILITY COVERAGE. For individuals, Texas law requires drivers maintain minimum liability coverage of $30,000 for each injured person, up to a total of $60,000 per accident, and $25,000 for property damage per accident. Although minimum limits coverages are common, many drivers wisely elect to have greater liability coverage limits.
Liability coverage pays the damages of people in the other car involved in an accident caused by drivers on your policy. Expenses can include car repair, car rental, and medical expenses. Liability coverage extends to accidents that are caused by you or anyone covered by your policy, including a driver operating your car with your permission.
- COLLISION COVERAGE. This coverage pays for damage to your car regardless of who caused the accident. The company will either pay for the repairs to your vehicle or if the vehicle is “totaled” (actual value is less than repair cost), they will pay up to the actual cash value of your vehicle, minus your deductible.
Often, instead of using Kelley Blue Book Values, insurance companies are now attempting to determine the actual cash value of your vehicle by comparing your vehicle with the sale prices of similar vehicles in your geographic area. It is helpful to locate comparable vehicles for sale in your area to use as a basis for the evaluation of the value of your vehicle.
- COMPREHENSIVE COVERAGE (PHYSICAL DAMAGE OTHER THAN COLLISION). This coverage pays for damage to or loss of your car from causes other than collisions, such as hail, vandalism, flood, fire, and theft.
- PERSONAL INJURY PROTECTION (PIP). Texas law requires an insurance company to offer drivers and passengers Personal Injury Protection insurance coverage, known as “PIP”. PIP insurance is mandatory, unless you sign a waiver declining the coverage.
PIP pays for your medical expenses such as medical and surgical treatment, dental and eye treatment, ambulance, nursing services, medications needed because of the accident, medical supplies and prosthetic devices. It also helps you or your passengers recover compensation for lost wages (PIP will pay 80% of lost income) and for the cost of someone to perform services like household tasks that the injured party is unable to do on their own.
Your policy will tell you the coverage limits of your PIP insurance, which refer to the maximum amount paid per person for their total expenses. The benefit limits are generally $2,500 or $5,000 or more. If you were a driver or passenger in another person’s car, were a minor or college student, or have multiple policies, you may be entitled to coverage, if needed, under more than one policy. This coverage does not have to be paid back to the insurance company.
- MEDICAL PAYMENTS (MedPay). This coverage pays reasonable and necessary medical and funeral expenses if you, a family member, or a passenger in your car is injured or killed in a car accident. This coverage is similar to Personal Injury Protection insurance coverage, but in most cases the insurance company require repayment of this benefit.
- UNINSURED/UNDERINSURED MOTORIST (UM/UIM). This coverage pays for your injuries and property damage when the person liability for the accident either does not have insurance or does not enough insurance to pay for all of your damages. Often these accidents are caused by a “hit-and-run” driver or a motorist without insurance. UM/UIM also pays when your damages are higher than the other driver’s liability coverage. Covered UM/UIM damages include medical bills, lost wages and pain and suffering.
It should be noted that nearly 15% of drivers on the road today do not have the legally required liability insurance. If one of these drivers causes an accident that injures you, your family and/or damages your property, there will be no insurance company to pay for the damages. You’ll be left to foot the bill — unless you have Uninsured Motorist insurance.
This coverage is one of the most important, yet most overlooked when purchasing automobile insurance.
- TOWING & LABOR COVERAGE. This coverage reimburses you for towing charges when your car must be towed to a repair shop or other destination.
- RENTAL REIMBURSEMENT COVERAGE. This coverage pays a set daily rate for a rental car if your car is being repaired because of damage covered by your auto policy. Often times, insurance companies will try to limit how long you are “allowed” to have a rental car.
In addition, to the coverage’s above, an additional motor vehicle insurance worth mentioning is Gap Insurance. Gap Insurance pays the difference between the actual cash value of a vehicle and the amount owed. In fact, it is not uncommon for some gap policies to cover the amount of the deductible as well. This coverage is important because if you are involved in an accident and your vehicle is determined to be worth less than what you owe, without Gap Insurance, you’ll be left owing the difference. Gap Insurance can also be added to the financing when purchasing a vehicle.
Hopefully knowing the different types of policies and coverage’s available to you and what the policies and coverage’s mean, will help you and/or your family to choose the best policy. Our suggestion is, that in order to protect yourself and your family, to purchase the largest liability policy you can afford and make sure that your policy includes PIP coverage, a significant UM/UIM policy limit, and Gap Insurance.
With offices in Denton, Dallas and Fort Worth, Texas, Chandler | Ross, PLLC and our Car Accident Attorneys are well positioned to provide the most effective, experienced and highly-skilled representation possible with a convenient location near you. Our experienced Denton/Dallas/Fort Worth Car Accident Attorneys can quickly respond to an accident, gather necessary information and preserve evidence in order to maximize your chances of recovery. Don’t wait, and don’t compromise – contact us today to see how we can help you. In most cases, you pay nothing unless we are able to settle your case or win a verdict. Our consultation is free. Contact us now at (940) 800-2500 or email@example.com to schedule your free car accident case evaluation and consultation.