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Monday, April 7, 2014

Help! I'm confused about Auto Insurance! ANSWER:Here's How to Ready Your Policy Contract

We all need to have insurance coverage for the vehicles we drive, not only because of law enforcement, but also because it's smart! Regrettably, some people only obtain coverage for what the law requires – which results in being under-insured when you need it for something other than the legal obligation. Others only want what their lienholder requires, which overlooks additional options that could be very useful. None of us like to think about the moments when we may need to actually use the coverage, but unfortunately things happen.


Let's break down the basics of auto insurance, starting with what is required by law and why:



In short, Auto Insurance is a policy purchased by vehicle owners to mitigate the costs associated with getting into an auto accident. Auto insurance premiums vary depending on: vehicle year/make/model, driver age/driving history, and other minor factors such as vehicle safety reports and repair costs. Most states mandate that all vehicles must be covered by the minimum amount of insurance.


Mississippi law requires that all drivers maintain liability insurance and carry proof of that insurance in their vehicles at all times showing that coverage is in place with minimum limits of 25/50/25. To many, "25/50/25" looks foreign. Here is the secret code breaker on how to read the average auto insurance policy: $25,000 maximum will be paid by the policy per person (limited to a single accident), $50,000 maximum paid per accident for bodily injury, and $25,000 maximum paid per accident for property damage. When you are responsible for an accident, liability coverage pays for the damage you cause to other people's health and their property, and it protects your assets from seizure and litigation.


Remember, if you are at fault in an accident, liability coverage will only pay up to your limits of insurance. You will be responsible for any damages over that amount. In todayʼs era of ever-rising medical costs and auto repair bills, the state-mandated minimum requirements of 25/50/25 are not sufficient. It is a good idea to consider purchasing liability coverage with higher limits. Consider the total value of your assets and income, and speak with your Trusted Choice insurance agent to discuss what liability limits of coverage are best suited for you personally.

 

All other coverages are optional, unless you have a loan on your vehicle. If you have a loan, your bank will require that you have Comprehensive (Comp) and Collision (Coll) coverage to protect their interest in the vehicle until your loan is paid off. If your insured vehicle is damaged due to an event other than a collision, Comprehensive coverage will pay for the damage. This includes damages from fire, theft, windstorm, flood and vandalism. Comprehensive coverage is also the coverage used for glass claims, such as when a rock hits your windsheild and causes spider like cracks. When your insured vehicle overturns or collides with another object, Collision coverage pays for the damage to repair or replace your vehicle. Both of these coverages include a deductible. A deductible is the amount you agree to pay out of your pocket for the damage which results from an at-fault accident. You can reduce your premiums by agreeing to take on more risk, which is accomplished by increasing your deductible. If you do not have a loan on your vehicle, it is still recommended to carry these coverages so that you are fully protected in the event your vehicle is damaged or totaled in an incident. However, the current market value of your vehicle will impact the amount of payment you would receive in the event of an accident.


Again, we recommend you review the current value of your vehicle based on age, mileage and wear, and discuss this information with your Trusted Choice insurance agent to decide if these coverages are reasonable options for your vehicle.

Coverage to protect you in the event that you are struck by an uninsured motorist (UM) or under-insured motorist (UIM) are listed on your policy in the same way as your own liability coverage, such as 25/50/25. If a driver or owner of a vehicle does not have insurance and is legally liable for an accident with you, you can use your UM coverage for injuries, including death, that you, your resident relatives, and any occupants of your insured vehicle sustain, up to the limits you selected for your policy. Or, if a driver or owner of a vehicle is legally liable for an accident but does not have enough insurance, you can use your UIM coverage. So, in other words, the UM/UIM coverage protects YOU, and the coverage needs to be sufficient for your protection. $25,000 is just too low, and probably won’t even cover the cost to repair/replace your vehicle. When purchasing these coverages, consider the value of your vehicle as well as how much coverage you have in health insurance and your deductible options to help you decide what limits of coverage are best suited for you.

Medical Payments (MedPay) is an optional insurance coverage that pays for reasonable and necessary medical and funeral expenses for you and any occupants of your vehicle or the other guy’s vehicle. These expenses must be incurred as a result of an auto accident, but in most cases does not mean you or the injured party have to be in your insured vehicle to use this coverage. Many policies also extend MedPay coverage to claims where insured pedestrians are struck by vehicles as well. This is a very valuable and low cost coverage, and many people match the deductible on their health insurance with the amount MedPay coverages, so that both polices may be used to cover the cost of a hospital visit. Review your MedPay coverage with your Trusted Choice Agent to verify what limits are included on your policy.

Roadside Assistance Coverage provides services such as towing, flat tire change, locksmith service and battery jump-start to customers, who can elect the service for an additional premium. Depending on the insurance provider, in some cases you contact your insurance company when in need of assistance while other companies require you acquire the service, pay and then supply the receipt for reimbursement.

Rental Reimbursement Coverage provides rental car coverage if you have a claim that is covered under Comprehensive or Collision coverage. Daily rental amounts are subject to the limit purchased on your policy. Many people mistake this coverage as being available for any time a rental car is used by the insured, but this coverage is actually only used in the event of a claim.

Most Auto Insurance companies offer Gap Insurance. If your insured car is totaled in an accident, or stolen and unrecovered, your auto insurance company may give you a settlement based on the car’s actual cash value (ACV) at that time, and not what you actually paid for it. Since cars depreciate in value quickly, your settlement may not cover what you still owe on your auto loan or lease. Gap insurance covers the difference between what the car is worth and what you owe on the car. One of the biggest mistakes consumers make in buying car gap insurance is to buy it at the dealership where it costs more. When purchasing a new vehicle, contact your Trusted Choice Agent to see if this option is available to you.

This information covers the basics of Auto Insurance, but does not break down other rules and regulations. To learn more, contact SouthGroup Insurance today by calling or visiting one of our 3 convenient coastal locations. We recommend an annual insurance review to all of our clients and welcome new visitors to let us review your coverage with you also and make sure you have the best coverage for your personal needs at the best rates available.
Still sound like a foreign language? Call SouthGroup Insurance and speak with one of our licensed agents to learn more. We offer full insurance reviews of all your policies at no charge, helping you better understand what coverage is best suited for you personally and why. No appointment is necessary to visit one of our 3 convenient coastal locations in Bay St. Louis, Diamondhead and Biloxi.

We are your LOCAL Trusted Choice Advisors, SouthGroup-Gulf Coast http://www.southgroupgulfcoast.com / ,
SALES AND SERVICE AGENTS: Angelyn Treutel Zeringue, Tammy Garfield, Tammy Hogue, Brittany Jones, Denise Russell, Melissa Moran, Alex Treutel, Susan Monti, Anne Gillam, Ashlie Moody, Michael Reso and Whitney Zimmerman at SouthGroup Gulf Coast. You can reach us by snail-mail or in person: 412 Hwy 90, Suite 6, Bay St Louis MS 39520, email:
atreutel@southgroup.net , phone: 228-466-4498 , fax:888-415-8922, FaceBook www.facebook.com/southgroup.gulfcoast, or Twitter www.twitter.com/atreutel !

 
We have 3 Gulf Coast locations to serve you - 2505 Pass Road - Biloxi, 5400 Indian Hill-Diamondhead, and 412 Hwy 90 Ste 6-Bay Saint Louis, MS. We write coverage in 40 different states and can assist you with Mississippi insurance, Louisiana insurance, and Alabama insurance and many other states. Insurance is stressful, but we make saving easy.  We help you save money on insurance!

Thanks to Susan Monti for her words of wisdom!