One of the best things you can do for yourself is to understand what is covered by your auto insurance policy. You might be surprise at what is covered by your policy when you get right into it. Here are a few things you might not realize that you are covered for when it comes to auto insurance:
Items Your Car Insurance Policy Covers
Car Sales Tax for Replacement Cars
When you get in an accident and your car is “totaled”, it is possible for you to get help paying sales tax on your new car. Some states require that insurance companies reimburse you for the sales tax you pay when you are forced to buy a new car because the old one has been deemed undrivable. Make sure you check with your car insurance policy, and with your state, though, since not all policies will cover this cost.
If you give permission for someone to borrow your car, damages to the car are still covered under the policy in most cases. Indeed, your coverage from liability to collision is extended to those driving a covered car that is borrowed. You are still responsible for the deductible, of course, but it can provide peace of mind to know that you won’t have to pay for all the repairs.
Many people like to add equipment to their cars. This includes new stereos, GPS systems, custom paint and other items. You can get coverage to protect yourself against damage and theft with help from your auto insurance company. However, you need to be aware that most policies don’t offer coverage for valuable add-ons automatically. Usually, you have to request the additional coverage and pay a small premium increase.
If your pet was injured during a car accident, you might be able to get help from your auto insurance company in paying for the bill. This can be a big help in the event that you don’t have pet insurance — or your pet insurance coverage won’t take care o the entire bill. Make sure that you understand the requirements, though. In some cases, you may need to have comprehensive coverage on top of collision coverage in order for your pet to be covered while riding with you.
Theft of Personal Items — Check Your Homeowner’s Policy
Interestingly, your auto insurance policy probably doesn’t cover the theft of personal items and gifts from your car. While damage to your car, and the theft of your car, are covered, the items you keep laying around in your car usually aren’t. These items, though, may be covered by your homeowner’s policy. Even though your personal items were stolen from your car, and not your home, in many cases your homeowner’s or renter’s policy will reimburse you for the value of these items.
Understand Your Coverage
It is important to understand your coverage whenever you get an insurance policy. Be clear on what is covered by which policy, and double check to ensure that all your paperwork is in order. Be aware that state laws governing insurance are different, so you may need to check into the rules associated with your specific state. A knowledgeable financial professional or trustworthy insurance agent can help you navigate these waters, and help you understand just what is covered by your insurance policy.
Photo credit: Robbie Howell