Auto Insurance Policy – Selecting The Right Type of Coverage You Need

Because there are different coverage options in an auto insurance policy, the provided security relies mainly on the things it covers. What, who and how things are covered will all depend on the type of coverage you get. Your security relies on the differences and combinations between policies.

To make sure you’ve got the right protection in your auto insurance, you must know the different types of coverage included in your policy.  Many people consider the full-coverage option as the best choice. But this can be a tricky term and can be applied by agents to present a not-so-clear coverage.

What you need is a clearer term that corresponds to the special type of auto coverage.  The moment you understand it, you become more decisive in selecting your auto insurance policy.

1.  Liability Insurance

Liability insurance covers damages and injuries that the insured driver has done against other people and their property. The claims in this coverage are settled only when an accident is caused by the owner of the holder.  While it can pay for the full amount of loss to the other person, this liability insurance pays nothing for the common losses done by the policyholder.  Nevertheless, there are legal cases where a policyholder’s legal expenses can also be covered by this insurance.

2.  Medical Payment

Regardless of fault, this type of insurance covers medical and funeral costs incurred by any occupant of the insured vehicle—for up to 3 years after the accident.  In the same way, the primary insured person and his members of the family are also covered.  If any of them got hit, as pedestrians in public roads, they can also get claims from this type of insurance.  Furthermore, Medical Payment insurance covers also those people transitioning out or into the vehicle.

3.  Uninsured & Under-insured Motorists

In the state of Florida, there are many uninsured motorists seen driving everyday along the road. Under-insured motorists and uninsured motorists insurance have the coverage that take the cost of damages and injuries incurred—when hit by either of these two kinds of motorists.  This is the coverage applicable to the main insured person, immediate members of the family, including other passengers inside the vehicle

4.  Collision Coverage

Regardless of fault, Collision Insurance covers the damages to the car of the policyholder in common collisions.  Aside from the vehicle repair or replacements, secondary costs such as towing and car rental are covered occasionally.  Take note also that collision coverage is rarely applied to damages done to animals.

While all collision policies can replace a car, they classify the best benefits by applying two techniques.  Insurance policies using the actual cash value classify the benefits based on the cost of replacing the covered vehicle with the same used car.  Insurance policies that use the replacement cost value classify the benefits based on the cost of the same new car.  In general, it’s more expensive for policies that use this value, since the cost of replacement can be settled for bigger benefits.

5.  Comprehensive Coverage

Typically, Comprehensive Insurance covers the damages to the vehicle of the policyholder—except for the collision that deals with vandalism, stealing or weather.  This coverage can be purchased by the policyholder only, as long as collision coverage is purchased, too.  As a way of securing their investment, normally financial institutions require comprehensive and collision coverage for all the leased and financed vehicles.  Similar to collision coverage, the comprehensive coverage utilizes either the replacement cost value or the actual cash value in defining the highest benefits.

Auto insurance is made up of different types of insurance coverage as viewed above.  Depending on the exact needs of the people, the composition of their auto insurance policy should match their needs.  So, it’s smart to select a coverage based not on the price, but on the things you want your auto insurance to cover.

To get additional information on the types of coverage in Florida Auto Insurance Policy, please contact us at DMG Insurance and Financial Services, Inc. ( at 543 N State Road 7, STE 106, Royal Palm Beach EL, 33411, phone 561 422 7071, Fax 561 422 7072.

Auto Insurance Policy – Selecting The Right Type of Coverage You Need

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