The reason individuals carry auto insurance is to protect themselves from financial destruction and loss of income.

It protects them against other people suing them for sums of money larger than they can afford to pull out of pocket, savings and investments.

It will also provide a monetary benefit to the insured if they get injured by another party who doesn't carry any or enough insurance coverage. Sometimes people become totally disabled and can no longer provide an income due to injury in an auto accident.

As you can see this is really meant to be a catastrophic coverage policy that will cover exceedingly large sums of monetary damages. Having the proper coverage in place makes sure that you and your family will never lose your home, investments and income due to any auto accident whether it is your fault or not.

NOTE: A good rule of thumb for filing claims is that if it is not more than 3 to 5 times your deductable it is not worth claiming.

The insurance companies get that money back from you by increasing your premiums over the following 3 years and they know that you will not be able to change insurance companies during that time period. Your existing company will raise your premiums just enough so you won't be able to go to another carrier.   

GLOSSARY OF TERMS

Bodily Injury- Pays for damages to other people that you hit when involved in an auto accident. It would typically pay for medical expenses, lost wages and pain and suffering. There are other issues that you may be responsible for if the other party decides to file a law suit against you.

Property Damage- Pays for the damages that you do to property belonging to some one else when your at fault in an auto accident.

Uninsured/Underinsured- Pays for your lost wages and medical expenses when someone else hits you but they do not have any insurance coverage or may not have enough insurance.

Could provide income benefit if totally disabled from an auto accident and you can no longer work.

Protects against loss from irresponsible drivers that don't see the need to carry proper insurance. One out of every 3 drivers in our state don't carry insurance let alone the ones that don't have enough coverage.

Medical Payments- Pays medical expenses for you and anyone riding in your car; limits apply on a per person basis. It is also a first and foremost payout coverage which means that it pays before anything else does no matter which party is at fault. Typically meant to cover deductable's and co-pay's on health insurance, ambulance rides, surgeries, medicines and medical procedures that arise from an auto accident. Also covers you if you get hit as a pedestrian or while riding a bicycle.

Comprehensive Coverage- Repairs your vehicle for damages if caused by anything other than collision; sometimes known as, Other than Collision coverage. This covered loss includes wind, hail, lightening, fire, animals, falling objects, flooding, theft, vandalism and most other losses due to something other than an accident. You have to select a deductable that you are willing to pay out first before the claim starts getting paid. The higher the deductable you select the lower the cost of your policy.

Collision Coverage- Pays to fix and repair your vehicle if it gets damaged in an accident. You choose the amount of risk that you take based on the deductable that you elect to pay before the claim starts getting handled. The higher the deductable you select the lower the cost of your policy.

Fire contents coverage- Applies to motor homes, campers, etc. - Covers personal belongings in campers, motor homes and travel trailers that is considered personal property. These things are not covered by your auto or homeowners insurance for destruction due to a fire.

Trailers - based on a stated value. The auto liability covers it if it comes off and hits something. You need extra coverage added based on the value to cover the trailer itself for physical damages on both comprehensive and collision exposures.   

GAP Coverage- Covers the difference from what you owe on a vehicle to what the car is worth up to 125% of its value. So if you owe $25,000 and the car is worth $20,000 it covers the $5,000 difference you would owe if anything happened to the vehicle.

Stereo equipment- covers stereo equipment put into the vehicle that is not factory installed and CD's that are carried in the vehicle.

SR-22- Third party agreement with which the client is saying to the dept. of motor vehicles that they are insured and the insurance company will notify the DMV if inured doesn't keep the insurance in force.

Tractors- are considered personal property covered by homeowners insurance except for collision, upset and liability off the premises. To have this covered for these exposures you would need to have an additional policy written just as if you would an auto policy.