It is always disappointing when your automobile insurance claim is turned down or you aren’t paid enough. Naturally, you would feel you are handled badly by the claim adjuster or insurer. This may be true but high expectations can be the reason behind feeling let down or unsatisfied. Also, It may be that you are mislead by rosy advertisements or you misinterpreted your policy coverage.
It is essential to know the answer to what does auto insurance cover in order to avoid disappointments when you have a claim. Claims can be complicated even when everything is in order. So, imagine how complicated it can get when it isn’t clear if your policy covers your losses or not. Make no mistake that insufficient car insurance coverage can hinder claim payments.
We will have a look at a few frequently asked auto insurance claim payment questions below and deal with misconceptions. Also we will offer tips on the required coverage that would have satisfied policyholder expectations. Looking at some claim examples and how they are handled may help you arrange the right coverage and appreciate the concept of insurance better.
How Much to Expect from Car Accident Settlement?
There are policyholders who have liability only auto insurance coverage and they believe that is all they need and their vehicles will be repaired or fully paid if they get totaled. When you have expectations like that you will certainly be disappointed to find out that you will receive no compensation for your own losses because a liability car insurance policy pays for third party losses only. You need to have collision coverage in order to claim for the damages to your automobile. Then, it will be fully repaired by your insurer or you will get a check for its full market value if it is totalled.
It is always worth remembering that companies would want their customers be fully satisfied with the services they offer. Otherwise, they would lose customers to competitors and they do not want that.
Is Minimum Liability Auto Insurance Coverage Enough?
Many people may think that the state minimum car insurance cover releases them of any further responsibilities. This is never true. These policies are enforced to provide minimum level of financial guarantee to unsuspecting citizens from car accidents. It is not the maximum level of liability a driver responsible for.
Certainly, there is nothing stopping an injured party to sue the responsible driver (or car owner) when the insurance pay-outs are short to cover all their losses. So, you stand out to pay a lot more when you cause serious injuries to third parties.
As long as you can afford it increasing these minimum limits a few times would be a wise decision. You should remember that you can have larger coverage and still get cheap auto insurance premium if you shop around for the best policy packages.
Does my Policy Pay for Car Rentals while Mine Is Being Repaired?
Many people are under the impression that they will get a courtesy car or their car rental will be paid by the insurers when their own vehicles are down by an insured peril. Many motorists do rent without checking this point. In some cases, they may have the cover but not enough and they end up paying the difference.
Not every policy includes Rental Reimbursement Coverage. Motorists are required to check if this cover is offered before going ahead with their plans. Some cheap full coverage auto insurance policies may exclude similar extras so that the premium is affordable.
Even such cover is in place it is likely to be for a limited time and up to a certain amount. Normally, about $30 a day for 30 days is the figure. So, policyholders are not free to spend as much as they like. If they do they pay the difference.
This coverage costs about $30-$50 and you should include it if you would need a rental arrangement in case of accidental damages to your one.
Does My Insurance Pay Off Loan if my Car Is Totaled?
There is confusion among motorists as to what they will receive when the vehicles are totaled following an insured loss. Many believe that they will receive the amount they declared in the quote form. This is not the case. Automobile insurance companies will only pay the open market value of a similar vehicle.
Insurance is for compensating losses, nothing more or less. If you have lost a 6 year old mid-range family saloon you will be paid to buy a similar car in the open market. You will in no way get a brand new car.
That is why you will probably need GAP auto insurance coverage when you are taking a loan on the automobile. This coverage is there to cover the difference between the open market value of the vehicle and the outstanding loan on it. Then, you will not be paying off an auto loan even though you lost the automobile.
Can Insurers Insist that Certain Body Shops Repair Damaged Cars?
There is a common belief that it is up to the insurers to either accept your body repair shop or force you to go to the companies they negotiated. Auto insurers cannot prohibit their policyholders from choosing a repair shop they prefer.
They will prefer their own network of repairers and they will make the claim process easier for you if you choose this route. It is not because they want to force you to go to these shops but they have already agreed with them what is acceptable and what is not. If you choose your own body repair mechanic they will ask a few more details.
First of all, they will want at least two competing quotes for the works. Secondly, they may want to inspect the damages before giving a go ahead. All these take a bit longer and therefore you may not be satisfied with the response time. If you do not know a good repairer you may speed up things by agreeing to a garage suggested by the insurer.
Is the Deductible Only Amount I Need to Pay Out of Pocket?
Loss adjusters will only approve the damages relating to the claim to be repaired. If agreed to unrelated repairs on your vehicle you will need to pay for them. If your automobile is hit on the right side and there seems to be an isolated old dent on the left it is unlikely that they will pay for this repair. However, you can get it done on your own since the vehicle is in the body shop already. You should ask for a quote and haggle for a better price if you need to.
We should look at one other case to demonstrate the responsibility in a crash. The car in front of you stopped and you stopped. But the car behind you crashed into you and you crashed into the car in front of you as a result. Are you responsible for crashing into the automobile in front? The answer according to the experts is that yes you are responsible for the repairs to the front vehicle. The reason for that is because you should have left enough gap between your car and the one in front.
This example goes to show you that the fault in a crash is not a straight forward case. Therefore, you should not accept liability before consulting your insurer. At the end, they will have to pay for the liability damages if you were found at fault and they should have a saying in the matter.