Important Things You Need to Know Before You Buy Auto Coverage
We've all seen the countless television advertisements from auto insurance companies, complete with catchy slogans and promises meant to attract new customers.
One company suggests that if you carry “cut-rate car insurance”, your accident claim won't be covered like it would if you had purchased your policy from them. Another carrier suggests that they'll “customize” your policy and will only sell you “the coverage you need”, inferring that you'll save money by not buying any unnecessary coverage.
But the truth is all auto insurance companies sell the same types of coverages, and the carriers will try to sell you coverage that is financially beneficial to them, and not to you. You should always buy what is called “stacked” Uninsured Motorist coverage, even if you just own one vehicle – in fact, you should insist on it.
Let's take a closer look at some of the most popular myths surrounding buying car insurance.
- I Should Be Covered for Anything, I Purchased “Full Coverage”
In Florida, there are minimum types of coverages that you need to have to be legally allowed to drive your car, and minimum amounts of coverage. Florida requires all drivers to have at least $10,000 in Personal Injury Protection, or what is commonly called PIP coverage. You're also required to carry a minimum of $10,000 worth of property damage liability, (PDL).
But the way some insurance agents explain it to prospective clients leads them to think that by buying just those minimum amounts of policy coverage, they're getting “full coverage.”
Nothing could be further from the truth.
Actually, there really is no way to define full coverage. Some people think that by purchasing the minimum coverage required in Florida, they have full coverage. But in reality, there are many other forms of coverage you really need to consider. One of the most critical is Uninsured (or Under-Insured) Motorist coverage. This will protect you if you are hit by someone who either has no insurance at all, or does not have adequate coverage in the event of a crash involving you and your vehicle.
In Florida, an incredible 26.7% of drivers on the road are driving without any insurance coverage. Some insurance agents neglect to fully explain UM coverage, or even offer it to you at all. Other types of coverages include Collision, Bodily Injury Liability, Gap Coverage, Comprehensive and more. Your agent may tell you that if you have health insurance, you don't need to buy Uninsured Motorist coverage, but this is not true.
When you're purchasing car insurance, it's critical to know exactly what you're getting, and what you really need. The experienced injury attorneys at Goldberg Noone Abraham deal with insurance companies every day, and we'll be happy to talk to you about your specific needs before you sign your policy, at absolutely no cost to you.
- I'll Get a Rental Car if My Car is Damaged or Stolen
A lot of people assume they'll automatically get a rental car at no additional cost if they're in a crash or their car gets stolen. This may be the case, but there are a few factors that affect what you can expect. Even if you have Comprehensive coverage, you may not be entitled to a rental vehicle.
You can purchase separate coverage that pays for a rental car for a few extra dollars, but even then, don't assume the coverage is open-ended. There are limitations about how long the insurance company will pay for a rental car, and also how much per day they'll authorize. Also, in most cases you'll be required to pay for the rental car out of your own pocket, and then be reimbursed by the insurance company later.
If you've been involved in a serious crash and your car is totaled, that can actually be beneficial to you. Your car being deemed a total loss can start the clock ticking sooner on getting a check for your loss, as opposed to waiting until a body shop gets around to repairing your damaged car, which can take several months.
- My Insurance Company Will Pay Off My Loan if My Car is Totaled.
If you're in a crash and your car is deemed a total loss, the bank or leasing company is still going to want to be paid back for the full balance of your loan or lease.
Your insurance company should pay you for the cash value of your car at the time of the damage, after subtracting the amount of your deductible. Supposing you still owe $10,000 on your auto loan balance but they calculate that your car's cash value at the time of the crash was only $8,000, you would be on the hook for the $2,000 difference. You may want to ask about what is called Gap Insurance to cover the amount not paid through your primary policy coverage.
Always check the cost of Gap Insurance coverage very carefully, as costs can vary greatly for dealerships and private purchasers.
As we've pointed out, insurance companies are not in business to lose money, so they will do everything they can to pay out as little as possible on your claim, or in many cases deny your claim completely. This is just one reason why talking to an experienced auto accident attorney can be of great benefit to you.
- I'll Pay the Same for Car Insurance in Miami as I Would in Fort Myers
There are many factors used by insurance companies in determining what you will pay for car insurance. One of the key factors is geographic location. Carriers use your zip code in setting your premiums, and you'll pay more in a larger city than you would in a small town. This is because insurance companies use your zip code where the car is driven and parked the most in setting your rates, and statistics show there is more risk to their insured vehicles and drivers in someplace like Tampa or Miami than in Fort Myers or Cape Coral, for example.
People in low income areas or areas with a higher concentration of minorities can also expect to pay more for their car insurance. Other things insurance companies use in calculating premiums is the age of the driver, and the age of the car. Someone who is 55 years old and financially stable, with no or very few driving infractions on their record, can expect to pay less than a 22-year-old with poor credit and several speeding tickets.
The age of your car can also factor into what you pay for insurance, as can the make and model. Generally, it may cost less to insure an older vehicle than it does a newer one, unless it is a model that requires costly parts to repair in the event of a crash.
You'll also pay more if your car happens to be a make and model that is often targeted by thieves. According to statistics compiled by the insurance industry, older Honda models, full sized Ford and Chevy pickup trucks and Dodge Caravans are at the top, of the “most stolen” list for the past 10 years. Older vehicles don't have the sophisticated ant-theft systems found in newer models, and car thieves know what kind of car to target.
- I Know and Trust My Insurance Agent, I Won't Ever Need a Personal Injury Attorney
A lot of people buy car insurance from an agent they have known for a long time. They may be a neighbor, a relative or someone they've met through a local civic organization. People assume that because they've done business with an agent for many years, their best interests are always being looked after, and they really don't need to study all the fine print of the policy.
Unfortunately, that is not always the case. You always need to keep in mind that insurance companies are in business to make money for themselves. It doesn't mean the agent you've dealt with for years is a bad person – it just means you owe it to yourself to really know what your policy says to avoid any costly and unpleasant surprises in the event of a crash.
Insurance companies sell you products that are created to benefit them, not the person taking out the coverage. If you're ever involved in a crash, the agent that sold you your policy will have absolutely no input as to the amount of money their insurance carrier will pay you to settle your claim. You'll be left in the hands of an adjuster, usually from some location in another state, who is likely using some form of computer algorithm or formula to determine what they feel is a fair settlement amount.
That's just another reason why a skilled personal injury attorney with extensive knowledge of the insurance industry can be a valuable asset if you're hurt in a crash.
The Attorneys at the Goldberg Noone Abraham Law Firm are Here to Help.A smart consumer should always know exactly what they're buying, especially when it comes to auto insurance coverage. Nobody likes to find out after the fact that their policy does not cover what they expected it would. It can be devastating to suffer a serious injury in a crash, along with having your car destroyed, and then realize you're going to be facing huge expenses because you didn't have the correct coverage.
Sadly, this is a scenario we see all too often.
Trial attorney Mike Noone spent years as a senior claims adjuster at a major insurance company prior to becoming a personal injury lawyer. He knows the way insurance companies operate, and the reality is they are not really ‘on your side'. Mike's insights and practical knowledge of how the auto insurance industry works can be an invaluable asset to you in the event you're making a claim following a serious crash, especially if you've suffered any type of severe injury.
Mike is always available to actually review your insurance policy completely before you sign on the dotted line to make certain you're getting what you will need to protect you and your family from the disaster that can result from being under-insured. It never costs you a penny to have us review your policy in detail – and it very likely could save you a lot of money and stress in the future.
Our firm has been helping victims of motor vehicle crashes for twenty years in Southwest Florida. Let us sit down with you and talk about your car insurance in order to best protect your financial future. You are under no obligation and there is absolutely no fee for our services.
Call us at 239-461-5508 or complete this simple online form and we'll contact you immediately. As the saying goes, an ounce of prevention is worth a pound of cure.