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What Damages Are Covered By Car Insurance?

Jul 13, 2023

Car insurance can help protect your finances when the unforeseen occurs; it's a binding contract between you, the policyholder and an insurance company. By paying an ongoing premium, you gain a level of financial protection against certain loss-making events involving your vehicle. Understanding the ins and outs of your car insurance is essential to fully leverage its benefits and safeguard yourself against these losses.

Understanding Car Insurance

In the unfortunate event of a vehicular incident, incurred costs can rapidly mount up. Without insurance, these costs would be entirely shouldered by the vehicle owner, potentially leading to severe financial hardship. In contrast, a successful claim on your car insurance can help to offset this financial burden.

Types Of Damages Covered By Car Insurance

Collision Coverage

Collision coverage forms a key part of car insurance, compensating for the cost of repairing or replacing a vehicle following a collision or other similar incident. It's important to understand that this coverage applies regardless of who is at fault.

Comprehensive Coverage

Comprehensive coverage is designed to insure your vehicle against non-collision damages. It can cover a broad array of incidents, such as:

Vandalism, theft or fire
Natural disasters, including hurricanes, earthquakes, floods or hailstorms
Damage from falling objects, like a fallen tree or debris from above

Personal Injury Protection (PIP)

PIP coverage is a specific type of coverage aimed at addressing medical and associated costs that arise from a vehicular accident. This encompasses the policyholder and their passengers. Notably, PIP applies irrespective of who was responsible for the accident. It may cover medical expenses, lost wages due to inability to work and even services such as childcare if you're unable to provide it due to accident-related injuries.

Uninsured And Underinsured Motorist Coverage

This type of coverage is designed to protect you if you're involved in an accident with a motorist who lacks sufficient insurance to cover the damages they've inflicted. It means you’re less likely to be financially stranded due to another driver's failure to adequately insure their vehicle.

Damages Not Typically Covered By Car Insurance

Despite the wide-ranging coverage that car insurance can offer, there are certain exclusions. Typically, these include:

Damages due to regular wear and tear or mechanical failure
Damages incurred during illegal activities or due to intentional acts of damage by the policyholder

Additional Coverages In Car Insurance Policies

Many car insurance policies offer optional additional coverages, which can provide further financial protection in case of specific scenarios. Here are some of the common ones:

Guaranteed Asset Protection (GAP): This coverage is particularly useful for new cars. If your car gets totalled or stolen, GAP insurance covers the difference between the car's actual cash value and the remaining balance on your car loan or lease.
Rental Reimbursement: In case your vehicle is being repaired due to a covered loss and you need a temporary replacement, this coverage pays for the cost of hiring a car.
Roadside Assistance: This optional coverage provides services like towing, tyre changing, locksmith services and battery jump-starts if your vehicle breaks down while on the road.

Understanding Deductibles And Premiums

Two key terms you'll encounter when procuring car insurance are deductibles and premiums. Your premium is the amount you pay to maintain your policy, typically on a monthly or annual basis. Conversely, the deductible is the amount you're required to pay out-of-pocket before your insurer will cover the remaining costs of a claim. Generally, higher deductibles lead to lower premiums and vice versa.

The Role Of Repair Services In Insurance Claims

Car repair services play a pivotal role in the process following an accident. Dependable and professional repair services, like 'Coastal Collision Repairs,' can assess your vehicle's damage, provide an accurate estimate for insurance claims and carry out the necessary repairs with expertise. They ensure your vehicle is safe and fit to return to the road following an accident.

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