Volume 2, Issue 12                    The Traut Firm eNewsletter              November 2007            www.trautfirm.com

The ABC's of Automobile Insurance (Part 2)

Uninsured/Underinsured Motorist

According to the California Insurance Code, Uninsured Motorist and Underinsured Motorist coverages (offered only in combination) must be offered in every insurance policy issued or delivered in this state. You must sign a special waiver to eliminate them from your policy.

Uninsured Motorist Coverage

Suppose you are injured in an accident caused by an uninsured motorist. Or, what if you are injured by a hit-and-run driver?

In both cases, uninsured motorist coverage (a hit-and-run driver is included in the definition of an uninsured motorist) will pay for bodily injury damages that you would normally recover from an insured driver. In addition to your medical expenses and loss of earnings, this can also include damages for pain and suffering. This means your insurance company will pay, up to your policy limits, you, relatives who live with you, and the occupants of your insured car for bodily injuries caused by an uninsured driver or by a hit-and-run driver. Uninsured motorist coverage also covers bodily injury costs for you and relatives who live with you, if injured by an uninsured motorist as pedestrians or while riding in someone else’s car.

Underinsured Motorist

What if you are insured and the coverage limits of the person at fault are not enough to pay your medical bills? Underinsured motorist coverage provides you with extra protection for bodily injury or death which results from an accident where the party at fault is underinsured. If the bodily injury liability limits of the person at fault are lower than your underinsured motorist coverage limits and not sufficient to cover you, then your underinsured motorist coverage will pay the difference up to your policy limits.

Coverage For Your Car

Comprehensive

If your car is damaged by fire, theft, vandalism, glass breakage, windstorm damage or even contact with an animal, comprehensive coverage will pay, less your deductible, for the cost  of your repairs or the actual cash value of your car whichever is less. Comprehensive coverage does not include wear and tear, engine failure, or other mechanical difficulties. When you are financing your car, comprehensive coverage will be required by the lienholder.

Car Rental Expense

What would you do if your car was damaged in an accident and you had no other means of transportation? Car rental expense coverage will reimburse you for the cost of renting a car. Companies providing this coverage usually offer it as an option. Details of the coverage vary by insurer. Some insurance companies let you choose between daily limits of $20, $30 or $45 for 30 days.

Collision

The cost to fix or replace your car if it’s overturned, or damaged in a collision with another car or object, is paid by collision coverage. Your insurance company pays for damages, less your deductible, for the cost of your repairs or the actual cash value of your car, whichever is less, regardless of who is at fault. Collision coverage is available only with a deductible although there may be times when your deductible is waived. For example, when damage to your car is caused by an uninsured driver and an uninsured deductible waiver (UDW) has been purchased, your deductible may be waived providing certain conditions are met. As with comprehensive coverage, if you are financing your car, the lienholder will require collision coverage.

Uninsured Collision (UC)

Suppose your insured car is not covered for collision, and you are hit by an uninsured motorist. If you have uninsured collision coverage, your insurance company will pay for the damage to your car or the actual cash value of the car (whichever is less) up to $3,500. This coverage applies only if you are legally entitled to recover damages from another party and certain other conditions are met.

If you ever have questions about your automobile (or homeowners) insurance, call James or Eric at (714) 835-7000. Consultation is free. There is no fee unless and until you win your case.

The Traut Firm
"When You Mean Business"