Auto accident insurance: are you covered?



Accidents happen every day. According to the statistics, nearly 3,700 people die around the world every day due to automobile accidents. Some happen naturally, while many more are caused by neglect.

While there is no way to stop accidents, we can take steps to mitigate the risks. One way to do this is to purchase traffic accident insurance.

Now let’s talk about auto accident insurance. What is that? What does it cover? How do you get it?

What is auto accident insurance?

Auto accident insurance is an arrangement or agreement between an insurance company and a car owner for protection against financial loss resulting from an accident. Both parties formulate and agree to specific conditions to govern the insurance policy. The policy works when you are involved in an accident.

The car owner has to pay a specified amount of money (bonuses) at an agreed period. In most cases, you will be asked to pay the premiums monthly, bi-annually or annually.

Some of the factors that determine the amount of premiums payable for auto accident insurance include:

  • The type of vehicle you own
  • Your driving habits
  • Driving experience
  • Demographic factors
  • Driving history

Are you covered by auto accident insurance?

It depends on the type of coverage you take. Auto accident insurance includes various coverages. They include;

1. Protection against bodily injury

Personal injury protection insurance covers the policyholder and passengers, or those named in the insurance policy. This is part of auto accident insurance, but the premiums are billed separately.

If you are involved in an accident, personal injury protection will cover the following:

  • Hospital bills
  • Medical bills
  • Lost wages
  • Other costs not included in your health insurance
  • Funeral expenses

Protection against bodily injury, also known as no-fault insurance, only covers bodily injury. It does not cover your vehicle or property damage. With Personal Injury Protection, you are covered even if you are not in your vehicle, possibly if you are injured while biking or just taking a walk.

Personal injury protection does not consider the offending party. As long as you’ve been personally injured and have the policy, you’re covered.

2. Personal liability insurance

Personal liability insurance covers third parties. For example, if you drive and accidentally hit someone or their vehicle, personal injury liability insurance will help cover the costs. Even if the person sues you, all legal costs will be paid by the insurance company.

Some states have minimum limits for personal liability insurance. However, you can still go over the limits to get additional coverage by paying more.

Personal liability insurance coverage;

  • Hospital costs for the other party
  • Lost wages / income
  • Legal costs, if you are sued

3. Liability for material damage

If you cause an accident that damages someone else’s car or property, loss and damage is covered by liability insurance for property damage.

In most states, it is mandatory for vehicle owners to have this type of auto accident insurance.

If someone, maybe your friend or family member, borrows your car and damages someone else’s property, property damage liability insurance will always cover losses and repairs.

Please note that liability insurance for property damage does not cover damage to your vehicle. The properties covered by this policy include;

  • Other person’s vehicle
  • lodge
  • Shop
  • Office
  • Fencing
  • Floor lamps
  • Trees

4. Collision insurance

Although this type of auto accident insurance is not mandatory, it is still beneficial for car owners. Collision insurance covers damage to your vehicle after an accident. For example, if you hit or collide with another car, collision insurance will cover the cost of repairs to your car.

Also, if you damage your vehicle, such as hitting an object such as a tree or a fence, the collision damage will cover the cost of repairing or replacing the car.

However, collision damage does not cover;

  • Damage to another vehicle
  • Medical expenses (yours and those of others)
  • Non-driving damage such as theft or burglary

If you are renting a vehicle, having collision insurance is essential. If your car has already been reimbursed, you have the option of keeping or giving up your collision insurance.

Some of the things to consider when purchasing collision insurance include;

  • The cost of coverage
  • Affordability of vehicle repair or replacement services
  • The type of car you own

5. Full coverage

Comprehensive insurance covers your vehicle against factors unrelated to the collision. It helps to settle the cost of repairs or replacements resulting from things like;

  • Flight
  • Fire
  • Greet
  • Hitting an animal
  • Vandalism
  • Damage caused by civil unrest such as riots
  • Damage caused by falling objects such as trees

Collision damage is sometimes referred to as “non-collision” or “own damage” insurance. It is the best protection you can give your car.

Collision coverage does not cover depreciation, electrical or mechanical damage, legal fees, medical expenses, vehicle wear and tear, among others.

6. Coverage of underinsured or uninsured motorists

If you have an accident with a driver with insufficient or no insurance to cover the damage, Uninsured / Underinsured Motorist Coverage will pay the costs.

In addition, if someone hits you and runs away, this insurance will cover the cost of the damage caused.

What is not covered by auto accident insurance?

Some things are not covered by auto accident insurance. These included;

1. Natural calamities

Auto accident insurance does not cover damage to you or your vehicle due to natural calamities like tornadoes, earthquakes, floods and many more.

Many insurance companies include a “force majeure” clause in auto accident insurance describing natural disasters. Natural disasters are permanent exclusions from auto accident insurance.

It is highly advisable to go through the terms and conditions of the insurance policy before agreeing with an insurance company.

2. Personal effects

Most insurance policies cover the vehicle and the people in it, not the personal effects in the car. For example, if your car is stolen or vandalized and your personal belongings such as laptops, phones and car seats get lost, you will not be compensated.

What to do after an accident

Insurance companies have strict rules and guidelines governing policies. These rules must be followed in order for you to receive compensation.

Here’s what you need to do after an accident to make sure the insurance company accepts your claim.

1. Stop and protect the scene

Whether it is a major or minor accident, do not stray far from the scene of the incident. Make sure the scene is protected. Unless your vehicle is interfering with traffic, stay away from the scene. Be careful not to cause other accidents in the process.

Call the police to help get people away from the scene. The police will help you identify the person at fault.

Additionally, you will need a police report to file an insurance claim. Ask them for a copy before you go or ask them where / when you can get one.

2. Get help

After an accident, you can suffer serious or minor injuries. These can be internal or external. Internal injuries are difficult to detect and can appear a day or two after an accident. Don’t gamble with your life.

Whether it is a minor or major accident, you must seek medical help. If you or the other passengers are seriously injured in the accident, you will need an ambulance to take you to the hospital.

If you feel that you are not injured, you should still see a doctor for a check-up to make sure you are safe from injury.

3. Alert your insurance company

Your auto accident insurance provider should be among the first to know about the accident. The insurance company will send adjusters to identify the extent of the accident and the amount the insurance company will pay for the damage.

Additionally, you can call your personal injury lawyer for assistance. It is possible to be confused after an accident. Again, if you are seriously injured in the accident, you will not be able to make an insurance claim.

Plus, get crash details including crash location, date, license plate numbers, and more. If possible, take photos as proof. Take the names and addresses of witnesses, if there are any. They will help you with your auto accident insurance claim. You will need the witnesses if the case goes to court.

4. Request for roadside assistance

Once everything has been captured by you, the police, your insurance company, and emergency services evacuating the injured, you will need to move your vehicle from the scene of the accident.

But if the accident was serious and your vehicle is badly damaged, you will need roadside assistance to tow the vehicle.

If your vehicle needs to be towed, who will pay the towing costs? Usually you will have to pay the towing costs out of pocket. However, in some cases your insurance company will pay for the towing costs. But for that to happen, you need to follow specific guidelines.

For example, you will need to hire a specific towing company recommended by your insurance company. In addition, you may need to tow the vehicle to a specific location. If you do not follow the guidelines, your insurer may refuse to pay the towing costs.

If the money comes out of your pocket, agree on the cost before the vehicle leaves the scene of the accident.

At the end of the line

Auto accident insurance helps car owners mitigate risk and address financial losses resulting from car accidents. There are different types of car accident insurance that includes collision coverage, comprehensive coverage, bodily liability insurance and many more. Coverage depends on the type of auto insurance you have and the premiums you pay.

In the event of an accident, do not leave the scene. Call the police and emergency services and alert your insurer. Your personal accident lawyer may also be helpful.

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