Car and Truck Insurance – Part 1

Motor vehicle insurance can provide you with four different types of protection. First, insurance can protect you from a lawsuit by another person injured in an accident with you. Second, vehicle insurance can provide you with compensation if you are hurt by another driver who does not have his or her own insurance. Third, insurance can pay to repair damage to your own vehicle. Fourth, vehicle insurance can pay medical bills for treatment of injuries in a collision. LIABILITY INSURANCE: Liability insurance provides protection to you from claims made by another person who is injured in a collision that was your fault. Liability coverage will pay to hire a lawyer to defend you in a lawsuit about the collision. While the lawyer will be selected and paid by the insurance company, it is the lawyer’s job to represent you. If the lawsuit results in a court judgment against you, then the liability insurance will pay the amount of this judgment, up to the policy limits. Some claims from vehicle collisions are settled before a lawsuit is ever even filed in court. Liability insurance will pay the amount of the settlement, up to the policy limits. Liability insurance companies employ adjusters, who handle claims from vehicle collisions. They investigate the collision. The adjuster may take a statement from you or the other injured person, may photograph the vehicles, and may visit the scene of the accident. The adjuster will also want to study the report by the police officer who went to the collision. After a collision, it is important to have accurate information about what happened before the vehicles collided. For this reason, it is important to call the police immediately after the collision. In addition, it is important to let your insurance company know soon after the collision, so that the company can have an adjuster quickly investigate the claim. Similarly, if you are a person injured in a collision, it is important to contact an attorney promptly, so that the attorney may investigate the collision. NOT ALL VEHICLE INSURANCE POLICIES PROVIDE LIABILITY COVERAGE: When you buy a vehicle, you have a right to buy your own insurance, through the company of your choice. The vehicle dealer can require that you have insurance, but cannot require that you buy it at any particular location. Sometimes, consumers forget or fail to buy their own insurance for the vehicle that they are buying. When this happens, many sellers or finance companies have the right to buy insurance for the vehicle and add the cost to the buyer’s payment. However, in most situations that we know of, insurance bought by a seller does not provide liability coverage. Instead, the insurance only provides protection for the vehicle itself. This type of insurance will pay the dealer or finance company the value of the vehicle at the time of the collision or will pay for repairs to the vehicle. This insurance will not, however, provide any protection to you from claims by people who claim to have been injured in the collision. A buyer will usually get better coverage at a lower price by buying his or her own insurance. UNINSURED OR UNDERINSURED MOTORIST COVERAGE: Uninsured motorist coverage provides compensation to you if you are injured in a collision that is caused by another driver who does not have insurance. Uninsured motorist coverage will provide compensation to you up to the amount of the policy limits. Underinsured motorist coverage is similar to uninsured motorist coverage. Underinsured motorist coverage provides compensation to you if you are injured in an accident caused by a driver who has some insurance, but who does not have enough insurance to fully compensate you for your injuries. Underinsured motorist coverage will pay compensation necessary to compensate you for your injuries, up to the policy limits.