Personal Auto Policy
Most of us have a personal auto policy. We may know the premium we pay,. But do you know what coverage is provided? In the time of “only pay for what you need “ you must know about what is provided and understand what you need.
Compulsory Insurance Laws
In most states there is a requirement that the driver maintain liability insurance on their automobile. You are generally buying auto insurance because the law requires it be in place. Some states tie proof of insurance into the registration process for license plates. These laws have proven to be effective at reducing the number of uninsured vehicles on the road.
State Minimum Liability Limits
One feature of state required insurance is that the laws dictate what are the minimum acceptable liability limits. These limits are generally low and not adequate to protect you in the event of an at fault accident. Ohio, Kentucky, and Indiana require minimum liability limits of $25,000 per person, $50,000 per accident and $25,000 property damage liability. These limits would not cover the cost of someone else’s vehicle and if serious injuries are involved the liability limit would be quickly exhausted. While these limits are legal, they are not sufficient for protecting your interests. Our agency will not quote these limits for our customers.
No Fault Insurance
Some states, including Kentucky have adopted “no fault” laws that are intended to reduce the number of lawsuits related to auto mobile claims. Under no fault laws your insurance responds to your losses under medical payments. No fault laws allow litigation to be pursued in the damages exceed a specific limit of level in the law. In Kentucky the tort threshold is $1,000 in medical expense, a broken bone, permanent disfigurement, permanent injury or death. The low number for medical expenses makes the no fault provisions easily bypassed.
Uninsured / Underinsured Motorists
Despite compulsory insurance laws, there are people who do not have insurance. You can purchase uninsured motorist (UM) coverage to protect you in the event that an uninsured driver is at fault for your accident.
A more common exposure is that the other driver has low limits of insurance, and the damages exceed their limits of insurance. In this case you can purchase Underinsured Insured Motorist (UIM) insurance to protect you from this event. Be sure to include property damage with the liability coverage.
UM and UIM are not legally required in Ohio, Kentucky, or Indiana. You select the limit of coverage you desire to carry for these coverages.
Limits and your Umbrella
Most clients need an umbrella policy to extend their liability protection. The umbrella carrier will have minimum limits for their underlying auto policy. You should make sure that your umbrella extends to the UM and UIM coverages for more comprehensive coverage.
Your Covered Auto
The personal auto policy can be summarized by “insurance follows the vehicle”. In this case knowing what vehicles are insured is an important consideration. The typical personal auto policy provides insurance coverage for the following vehicles:
Vehicles shown on the declarations page – these are the vehicles you have reported to the insurance company.
Newly Acquired Autos – This coverage applies to passenger vehicles. Coverage for trucks with a gross vehicle wight of 10,000 pounds may not be automatic. These vehicles will be a covered for liability when they are acquired. The policy requires you to notify the insurer and add the vehicle to the declarations within 14 days. Collision and comprehensive coverage will apply if you have these coverages in effect on your policy. The 14-day notice period applies to adding the vehicle to your policy. If you have no collision coverage in effect at the time of vehicle acquisition, the notification period can be reduced to 4 days.
Owned Trailers – are vehicles designed to be towed by a passenger vehicle, pick up or van. You must own the trailer for coverage to apply.
Who is insured?
The auto policy covers the named insured and any resident family members using any auto. This means the insurance company will ask for the driver data for household members who may use a vehicle. The drivers are subject to underwriting review and age, experience and driving record are part of the underwriting and pricing process. Drivers with poor records can be excluded from coverage by the insurance carrier. Failure to report drivers to avoid the underwriting process may be considered a material misrepresentation and prompt a policy cancellation.
Coverage follows the car, so someone using the vehicle with your permission is covered by the policy. Coverage extends to organizations that may be held liable for auto accidents. This may apply to an employer if using your vehicle for business or an organization for who you volunteer.
The Driehaus Difference
Your personal auto policy requires an understanding of you family, your risk tolerance and how to structure this policy within your total insurance package. You should not compare auto insurance solely on price. Unless you know the terms, conditions, deductibles and limits for each coverage you have only one fact in hand. We work hard to create a comprehensive insurance package that has all of the parts working together to provide you comprehensive coverage. Call us at 513-977-6860 or contact us on the internet via our website www.driehausins.com.