What You Should Know About Auto Insurance BenefitsMay 9, 2023
Car insurance protects you financially in the event of an accident, covering expenses such as medical costs, property damages and legal fees if it was your fault.
Car insurance policies cover both your own vehicle and that of another, as well as optional add-ons that can make things simpler for you. Review these benefits so you can decide what policy best meets your needs.
Coverage for your vehicle
Your car insurance benefits depend on the kind of vehicle you own; full coverage includes both collision and comprehensive policies.
Most states mandate drivers carry at least some minimum amount of auto insurance, which varies by state but typically covers bodily injury liability and property damage liability.
Additionally, many states mandate medical payments and personal injury protection (PIP). These insurance benefits cover your medical costs and lost wages should an accident or someone’s actions cause you injury.
Your vehicle insurance should also provide rental reimbursement or gap coverage – these policies could cover the difference between what you owe on it and its market value in case it is declared total loss through an auto insurance claim.
Coverage for other people’s property
Insurance providers provide drivers with many services and benefits, from roadside assistance to property coverage for other people’s belongings. Some of these features may help drivers avoid expensive rate increases following an at-fault accident or minor violation on their policy.
Comprehensive auto coverage is often the best way to safeguard a new car against potential damage, and may cover most or all of its actual cash value in case it becomes totaled.
Auto rental insurance provides additional advantages, helping you locate a replacement car while yours is being serviced. This type of protection is especially helpful if you’re new to driving and don’t yet own one; an agent can assist with selecting which auto coverages best meet your budget; purchasing the correct policy could prove one of your most wise investments over time.
Coverage for medical expenses
If you or any of your passengers are involved in an auto accident and require medical care, there are a few auto insurance benefits which could assist with covering medical costs. These include medical payments coverage (known as MedPay) and personal injury protection (PIP).
These policies can provide coverage for medical bills and out-of-pocket expenses you might incur after an auto accident, up to your policy limit. They also cover emergency transportation costs, ambulance fees and services designed to assess injuries such as X-rays.
Reimbursement amounts can depend on both your auto insurance policy and state law; factors include your deductible, copays and coinsurance payments.
Some auto policies offer high deductibles and lower monthly premiums that might make sense for some drivers, but can become prohibitively expensive for drivers with more severe health conditions or increased out-of-pocket medical costs. MedPay may provide much-needed peace of mind in these instances.
Coverage for legal fees
After being involved in an auto accident, your insurer should cover any legal fees related to hiring an attorney to help negotiate or file suit against another driver. These legal costs could include hiring someone like our lawyer to negotiate your insurance settlement or file against them directly.
Your insurance may or may not cover legal costs depending on your state and policy terms; if your car insurance does not, consider purchasing a separate policy to cover these fees.
Business legal expense insurance (LEI) and prepaid legal plans provide coverage against the costs of hiring a lawyer for any legal matters that need professional attention. LEI typically targets larger organizations while prepaid legal plans tend to cover both small- and mid-sized enterprises.
Business legal expense policies come in two main varieties – before the event (BTE) and after the event (ATE). BTE insurance covers expenses that arise in the future while ATE policies address lawsuits already initiated.