Rosenbaum Injury Law Legal Minute – Car Insurance

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What to Consider when Purchasing Car Insurance

There are several different types of car insurance and benefits you can buy. In general terms, part of the insurance will cover you from damages caused by another driver.

The liability portion will pay for damages you cause up to the policy limits. In Pennsylvania the minimum liability coverage is $15,000. If someone has damages over your policy limit you will personally be responsible to pay anything over the limit. The higher the coverage limit will increase your cost and there is no definite answer as to what is the right amount of someone should have. Generally, the more assets you own, the greater the liability limits you should get. But you should seriously consider buying UM and UIM coverage to protect yourself and your family.

Uninsured (UM) and Underinsured Motorist (UIM)

You also have the option to purchase insurance to protect you and your family from accidents caused by someone else. This refers to uninsured and underinsured motorist coverage. Many people only purchase the minimum liability coverage required by law. Other drivers let the insurance lapse and have no insurance. If you sustain serious injuries the $15,000 will not be close to covering all of your loses. By getting the optional coverage you can make claim against your own insurance when the at fault driver does not have adequate coverage, It can be very frustrating when you can’t work and bills are piling up and the other driver does not have enough insurance to cover your losses.

“Full Coverage” is Not Always What You Think it is.

When clients first contact our office, they will often say they have “full coverage” on their car. However, when we investigate the coverage it turns out they only have collision coverage, but not uninsured motorist coverage. That means the property damage to their car is covered, but it does not mean they can make a claim for other injuries or damages against their insurance company. This also does not mean you have “full tort” which can limit your ability to make a claim. You can read more about “full tort” vs “limited tort” here.

Gap Coverage

Not all collision coverage is the same. Basic collision coverage will only pay the market or “Blue Book” value of the car if it is a total loss. Since the value of your car usually depreciates quickly, this can result in you owing more to pay off the car loans than the money you get from the insurance company. If you just purchased a new car this difference will likely be thousands of dollars. For a small amount extra, you can purchase “gap” coverage which will pay this difference. Otherwise, even though someone else is completely at fault you can still be out a lot of money.

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