Full Coverage Car Insurance
We have all heard the term “full coverage car insurance,” but what exactly does that entail in regard to auto insurance? It could mean different things to different people according to what they want to protect or insure for. It seems as we get older, it includes more and more coverages, some we may not have even known were options in our younger years.
You Must Have Liability
No one goes out for the day planning to get in an accident. With that being said, insurance protects us from those unexpected situations that range from slightly inconvenient to totally life-changing events. Most of us, by law, have to carry at the very least liability insurance, and many of us throw around the term, “full coverage car insurance” but without context that is an empty expression. It is our own choice on what we want to cover over and above that from ensuring protection for our own car, medical payments, emergency roadside and rental coverage to list a few.
How Rates are Calculated
While historically insurance rates are calculated according to driver history, zip code, and coverage selection, rates now seem to be rising with no change to those listed items. Insurance rates have gone up 22.6% over the past year. This is due to inflation, supply chain issues including parts and labor shortages, the rising costs of vehicles, and insurance fraud. Reviewing the Chevrolet Tahoe for example, in 2000 it cost $40,000 brand new, then in 2010 it was $45,000 and by 2020 it rose to $50,000. Even used, they are outrageously priced. Insurance has to take these prices into account when they are creating their rates and then calculate a driver’s liability for premiums. It is wise to buy cars with insurance and maintenance costs in mind, especially if you are expecting to have full coverage car insurance.
What is Required?
All vehicles in Arizona and Nevada (and most states in the union) are required by law to have liability insurance. With that being said, New Hampshire does not require liability and Florida only requires property damage liability. Liability minimum limits are state-by-state mandated. Nevada’s minimum liability has just raised to 25/50/25 from 15/30/10 and Arizona’s is 25/50/15.
The first number is the amount of bodily injury liability available to each person in an accident when a driver in another vehicle is at fault and the second number is the amount of bodily injury liability total per accident. The last number is the amount of property damage liability total for the accident. Meaning, for example regarding property damage, in Nevada if you have the state minimums your liability will cover only $25,000 of a vehicle or other property like guardrails, mailboxes or fences, etc, and in Arizona that coverage is just $15,000.
So back to the question at hand, what is full coverage car insurance? Simply put, most would agree its saving coverage for others (liability) and yourself (collision and comprehensive). But let’s break down all available coverages anyway:
Types of Coverage For Others
Liability
This is what protects others when you are at fault or liable for an accident. This usually (except in Florida) includes bodily injury and property damage sustained in an accident. While having the state minimum may keep your rates down, having higher limits protects you against lawsuits that may arise if your limits are lower than the loss you are liable for. These coverages are not for you, but for the parties that you cause damage to by your negligence. All other coverages are for yourself or those in your vehicle.
MedPay
This is the coverage available for injury to yourself or other passengers in your car. Even if you have medical or health insurance, it is a good idea to consider these coverages to pay for copay and deductibles for medical treatments including chiropractors, etc. This also pays for injuries resulting from being hit by a car as a pedestrian.
Types of Coverage for Your Own Vehicle
Collision
Protection for your vehicle to pay for damages sustained in an accident whether you are liable or not. If you are not liable for the accident, your insurance can pay for damages to your vehicle and will go after the other insurance company to recoup your damages and deductible in a process called subrogation. If you don’t carry this insurance and you are not at fault for an accident, you have to sometimes wait quite a while for the other insurance to complete their liability investigation, sometimes while your vehicle is waiting at the storage lot, incurring more fees that you may be required to pay for. If you have a lease or lien holder, they may require you to carry this coverage.
Comprehensive
This is coverage that protects against theft, falling or flying objects, animal hits, floods, vandalism, glass, hail, and other incidents that are not your typical car accidents. Usually, there is no liability associated with this coverage, just repairs made. Like collision coverage, if you have a lease or lien holder, they may require you to also carry this coverage, making it a component of full coverage car insurance.
Underinsured/Uninsured insurance
Like liability, this is different state by state. Some states cover both bodily injury and property damage, but Nevada and Arizona only have bodily injury coverage. Arizona has 11.3% and Nevada has 8.8%. This coverage has to be offered and if declined must be in writing. It covers you and your passengers when the other driver is liable, but either does not have insurance at all or does not have enough insurance to cover the costs of your injuries.
Other Coverage
Roadside assistance
Roadside assistance is a coverage that can be added that pays for towing, lockout services, flat tire changes (not the actual tire), fuel/fluid delivery (not the actual fuel/fluid), and other related roadside issues. This itself is generally beyond what people would traditionally consider full coverage car insurance.
Rental Reimbursement
This type of coverage too is out of the scope of what we would call full coverage car insurance. Rental reimbursement covers a rental for the policy limits you choose due to a collision and comprehensive loss while your car is either not drivable or in the shop getting repaired. This does not include a rental for mechanical breakdown or uninsurable losses.
What Should You Do?
It is recommended you review your own policy limits to see what your coverages are. Of course, full coverage car insurance, or whatever version of that applies to you and your state is always a good option. You can find information on your own coverages on your insurance declaration page or proof of insurance card, insurance app, or by calling your insurance company or agent. Some people trust a website to build their policy or their agent when really we should all be aware of what we are paying for to make sure we have the appropriate coverage for ourselves and family.
We Are Here to Help
When you or someone you love is in an auto accident, whether they have full coverage car insurance or just liability, reach out to Hale Injury Law for assistance in reviewing what is available to recover for both bodily injury and property damage that may have been sustained. We look forward to making you whole again.