In today's uncertain economic climate, it is completely understandable that folks would look for creative ways to save money each month. When searching for ways to cut back, paying as little as one can get away with for car insurance may seem like a good way to do so. It is possible that you may go your entire life without getting into an accident, that you pay your premiums on time every month, and that you have never submitted a claim through your insurance company. Unfortunately, even if you are a perfect driver, you cannot control the decisions and actions of others, and in a worst-case scenario you do not want to be caught without the most protection possible. What kind of coverages do you really need, though? Mike Noone, a founding partner at Goldberg Noone Abraham, addresses common misconceptions relating to auto insurance coverage, and what coverages you need to protect yourself in the event of an accident.
In the state of Florida, there are minimum types and amounts of coverages that you need to be able to legally drive your car. The state of Florida requires all drivers to have at least $10,000 in Personal Injury Protection, which is commonly known as PIP coverage. Drivers are also legally required to carry a minimum of $10,000 worth of Property Damage Liability, or PDL. A great deal of people believe that when they purchase these minimum coverages, they are purchasing something known as “full coverage”, when nothing could be further from the truth. Unfortunately, there is no such thing as “full coverage”, and there are many other forms of coverage that should be considered before deciding on a plan. One of the most critical is Uninsured (or Under-Insured) Motorist coverage, which protects you should you be hit by someone who either has no automotive insurance or does not have adequate coverage in the event of a crash involving you or your vehicle. In Florida, it is estimated that an incredible 26.7% of drivers on the road are driving without any insurance coverage. Some insurance agents neglect to fully explain what Uninsured Motorist (UM) coverage is, or even offer it to you at all. Your agent may even tell you that if you have health insurance, you do not need to buy Uninsured Motorist coverage, but this is not true. Under Florida law, insurance sales people are required to offer you the option of buying Uninsured Motorist/Under-Insured Motorist coverage, and if you decline, you're required to sign a form to that effect. While we can understand the need to save money in whatever way possible, we cannot stress enough the importance of buying adequate Uninsured Motorist/Under-Insured Motorist insurance coverage. Other types of coverages to consider include Collision, Bodily Injury Liability, Gap Coverage, Comprehensive and more.
Another important form of coverage to consider is what is known as Gap Insurance. Say the unthinkable happens, and you are involved in a crash that leaves your car totaled. Your bank or leasing company is still going to want to be paid 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. This is when Gap Insurance will be helpful, as it is used to cover the remaining amount not paid through your primary policy coverage.
As a note, always check the cost of Gap Insurance coverage very carefully, as costs can vary greatly for dealerships and private purchasers.
When you are purchasing car insurance, it is critical to know exactly what you are getting, and what you really need. As we have 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. Attorney Michael Noone deals with insurance companies every day and would be happy to talk to you about your specific needs before you sign your policy, at absolutely no cost to you. To take advantage of this complementary consultation from Mike Noone, please call our office at (239) 461-5508.