Understanding Auto Insurance

– By David Keller

Did you ever wonder what your auto insurance actually covers?  Have you ever wondered how your auto insurance coverage can affect you?  Are you curious who your coverage actually protects?  Here are the auto insurance basics that everyone should know.

  • Automobile Liability Insurance is required by the state.  It covers the bodily injury or property damage of others when you (the driver) are at fault.  The State of Ohio’s Financial Responsibility Laws require all licensed drivers and every registered vehicle to have liability limits of $12,000 for bodily injury, $25,000 per occurrence, and $7,500 for Property damage.  Although these levels meet Ohio’s limits, most insurance agents and industry experts agree that higher levels are recommended.
  • Uninsured / Underinsured Motorist Coverage protects you and your passengers in the event that you are in an accident with an uninsured or an underinsured driver.  This insurance coverage only is in effect when the other driver is at fault.
  • Med Pay will pay medical expenses from a covered event that causes bodily injury to you and your passengers.  Each policy has specified limits.  Ensure you understand these limits and when they apply.  Your insurance agent can help you understand the costs vs. benefits of different medical payment limits
  • Collision will pay for physical damage in the event that your vehicle is involved in a car accident.   Standard collision coverage specifies a deductable amount.  This amount is paid by you before the collision insurance starts to cover the damage to your vehicle.
  • Comprehensive pays for vehicle damage in the event the damaged is caused by anything other then collision.  Common events include vehicle fire, storm damage (hail), or theft.
  • Rental Reimbursement reimburses you for rental car expenses when your vehicle is involved in a covered accident.
  • Roadside Assistance and Towing pays for expenses associated with towing and labor when your vehicle is disabled.  This expense has distance limitations and other restrictions.  Review these restrictions with your insurance agent.

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