Frequently Asked Questions
About Automobile Insurance

Q: What is liability insurance?

A: If a driver is at fault in a car accident, liability insurance pays for the damages that he/she caused to someone else. It does not pay for his/her own damages. There are two kinds of liability insurance: bodily injury and property damage. Bodily injury expenses include medical bills, rehabilitation expenses, and lost wages. Property damage expenses include the repair or replacement of any item belonging to another person that are damaged or destroyed.

Q: Who is usually covered by automobile liability insurance?

A: Liability insurance usually covers the following people:

Named insured. This is the person or people named in the policy, no matter what car they are driving.

Spouse. Even if the spouse of the named insured is not named on a policy, liability insurance almost always covers him or her, unless the couple does not live together.

Other relative. This refers to anyone living in the household with the named insured who is related to the insured by blood, marriage or adoption, usually including a legal ward or foster child.

Anyone driving the insured vehicle with permission. Someone who steals the car is not covered.

Q: Which vehicles are normally covered under an auto insurance liability policy?

A: Liability insurance usually covers the following vehicles:

• Named vehicles. An accident in a non-named vehicle is covered only if a named insured (see above) was driving.
• Added vehicles. This includes any vehicle with which the named insured replaces the original named vehicle, and any additional vehicle the named insured owns during the policy period (you may be required to notify the company of the new or different vehicle within 30 days after you acquire it).
• Temporary vehicles. A temporary vehicle is any vehicle, including a rental vehicle, that substitutes for an insured vehicle that is out of use because it needs repair or service, or has been destroyed.

Q: What is uninsured or under insured motorist coverage?

A: Uninsured or under insured motorist coverage (Uninsured Motorist coverage) pays for your injuries if you are struck by a hit-and-run driver or by someone who does not have adequate insurance either because they have no coverage or because they do not have enough coverage to pay for your injuries. Normally, this type of coverage is limited to bodily injury, and it will not pay for damage to your vehicle or for other types of property damage. To get that kind of coverage, you will have to add collision coverage to your policy.

Q: Who is usually included in my uninsured/underinsured motorist coverage?

A: Most Uninsured Motorist coverage will pay up to your policy's Uninsured Motorist limits for injuries caused to:

• you or a relative who lives with you, while a driver or passenger in the vehicle named in your Uninsured Motorist insurance policy or any other vehicle, or while a pedestrian
• anyone else driving your insured vehicle with your permission, and
• anyone else riding in the vehicle named in your insurance policy, or in any other vehicle you are driving but which you do not own.

Q: What are the limits on my ability to collect under an uninsured/underinsured motorist provision?

A: Uninsured Motorist coverage usually limits your ability to collect and the amount you receive as follows:

• If your accident involves a hit-and-run driver, you must notify the police within 24 hours of the accident.
• If your accident involves a hit-and-run driver, the driver's car must have actually hit you. Being forced off the road by a driver who disappears is not sufficient.
• Your Uninsured Motorist coverage will be reduced by any amounts you receive under other insurance coverage, such as your personal medical insurance or any applicable workers' compensation coverage.
• If you or a relative are injured by an Uninsured Motorist while you are in someone else's car, your Uninsured Motorist coverage will be secondary to the Uninsured Motorist coverage of that other car's owner.

Q: What is collision coverage?

A: Collision coverage will pay for the repairs to your own vehicle if you are the one who is at fault in the accident. (Ideally, if the other party is at fault in the accident, their property damage liability insurance will pay for the repairs to your car.) Collision coverage is usually the most expensive type of auto insurance. Before choosing this kind of coverage, assess the value of your car to make sure it is worth the amount you will be paying in premiums. An insurance company will usually give you only the actual cash value of your car and not the amount that you will have to spend to replace your car. If you have an older car that does not have a very high actual value, it will probably not be worth it for you to carry this kind of coverage.

Q: What is comprehensive coverage?

A: Comprehensive coverage pays for damage to your car that was caused by events other than a car accident. Covered events can include theft, fire, vandalism, natural disasters, even hitting a deer. Comprehensive coverage, like collision coverage, usually insures only the actual value of your car and not the replacement value. Before choosing this kind of coverage, check the value of your car. If your car has an extremely low value, paying the high premiums of comprehensive coverage may not be the most advisable.

Q: How do I determine the actual value of my car?

A: The actual value of your car is the amount that your car was worth at the time that it was damaged or destroyed. Unless your car is brand new or a collector's item, this value is usually less than the replacement value that is, what it would cost to repair damages to your vehicle with materials of similar kind and quality. You can find the actual value of your car by going to a library or bookstore and referring to a Kelley Blue Book (www.kbb.com).

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