Vehicle Insurance

1
Vehicle Insurance

• Chapter 38

2
Economic Risks of Owning a Car

• Risks
• Accident
• Damage to yourself
• Damage to your vehicle
• Damage to others
• Damage to others property
• You can buy insurance to protect yourself from
  the financial loss caused by almost anything that
  could happen to your car.

3
Auto Liability Insurance

• Automobile Liability Insurance this is the
  insurance that you can buy in order to protect
  yourself against financial loss if you injure
  someone else or damage someone elses property.
• This will also cover your defense in a court
  hearing, to determine who is at fault in an
  automobile accident.

4
Types of Coverage

• Personal Injury Coverage
• Bodily Injury Liability
• Medical Payments
• Uninsured Motorist Protection
• Property Damage Coverage
• Property Damage Liability
• Collision Insurance
• Comprehensive Physical Damage

5
Personal Injury Coverage

• Bodily Injury Liability Protection
• Protects the insured from claims resulting from
  injuries or deaths for which the insured is found
  to be at fault.
• Covers people in other cars, passengers riding
  with the insured, and pedestrians.
• It does not cover the insured or, in most cases,
  the insureds immediate family
• This is normally expressed in a fraction
• 100/300
• 100,000 of coverage for if just one person is
  hurt, while the 300 indicates 300,000 is the
  maximum amount which the company will pay for the
  accident altogether.

6
Personal Injury Coverage

• Medical Payments Protection
• Policyholders and their family members are
  covered if they are injured while riding in their
  car or in someone elses car.
• This will also cover a pedestrian hit by a car.
• Medical payments that are covered would be that
  of medical, dental, ambulance, hospital, nursing
  and funeral services.

7
Personal Injury Coverage

• Uninsured Motorist Protection
• Protects against uninsured drivers or drivers who
  have no money to pay claims.
• Also protects against damage caused by a
  hit-and-run accident
• This is only used if the uninsured motorist is
  found to be at fault.
• This will only be sold in a policy which does
  have bodily injury liability.

8
Personal Damage Coverage

• Property Damage Liability
• Protects the insured against claims if the
  insureds car damages someone elses property and
  the insured is at fault
• This covers property such as another car,
  telephone poles, fire hydrants, and buildings
• This does not cover the insureds car

9
Personal Damage Coverage

• Collision Insurance
• Protects against a car owner against financial
  loss associated with damage resulting from a
  collision with another car or object or from the
  car turning over.
• This type of insurance includes a deductible
  clause.
• If the cost of a collision is more than the cost
  of the car, the company only pays the cost of the
  car.

10
Personal Damage Coverage

• Comprehensive Coverage
• Protects the insured against almost all damage
  losses except those cause from a collision or
  from the car turning over.
• Fire, Tornado, Windstorm, Vandalism, Falling
  Objects, Hail, and Theft.
• The estimated value of the car is what the
  insurance company would pay, in the event the car
  was totally destroyed or if the car was stolen.

11
Buying Automobile Insurance

• Insurance Rates
• Some factors which are considered when figuring
  the cost of auto insurance
• The purpose for which you drive your car.
• The number of miles you drive your car each year.
• The value and type of your car.
• The community in which you live in.
• Types of coverage and deductibles.

12
Vehicle Insurance Laws

• Compulsory Insurance Laws
• This requires you to carry certain types of
  automobile insurance before your car can be
  licensed.
• You can not register a car or get a license to
  drive without providing proof of having minimum
  amounts of insurance coverage required.

13
Vehicle Insurance Laws

• Financial Responsibility Laws
• This laws says that if you cause an accident, and
  you are unable to pay for the damages either
  through insurance, your savings, or the sale of
  property, your drivers license will be suspended
  or taken away.
• Assigned Risk Plans
• Each insurance company in the state must sell
  liability insurance to a fair share of the high
  risk drivers.
• This fair share is determined by the amount of
  insurance the company sells per year.

14
Vehicle Insurance Laws

• No-Fault Insurance Laws
• In an effort to speed up the payment of claims
  and reduce the hardship of long delays this law
  requires that you get compensated for your
  losses, from your own insurance company, no
  matter who is at fault.