No driver expects to be in an accident. Unfortunately, however, accidents do occur and it’s important for you to understand all of your auto insurance options. One thing we always recommend to our clients is that they maintain adequate collision coverage. If you have a loan or a lease on your car, your lender probably requires it. The reason is simple. If you are properly covered, your insurance company will pay for the damage to your vehicle regardless of whose fault the accident was. If you do not have collision coverage and the damage is due to the negligence of another, your only recourse will be to collect from the party who caused your vehicle’s damage. Hopefully, that individual will have liability coverage that will pay you through his/her insurer. However, if the individual does not have liability coverage, your only remaining option is to personally pursue your claim against the negligent party.
You will likely have to pay your deductible when you use your collision coverage. On the other hand, the other party’s insurance company will probably pay your deductible up-front if the accident was his or her fault.
Usually, the maximum that is paid for damage to your car is the amount necessary to make the repairs or replace it with a comparable used vehicle. However, there is an exception. Should your vehicle be considered a total loss and you have a replacement cost value endorsement as part of your collision policy, your insurance company will allow you to replace your vehicle with a comparable new one.
Choosing an insurance company that has a reputation to fulfill their obligations in a timely manner will relieve many headaches. Also, having an agent who will take the time to walk you through every step and hold your hand makes a car accident a less traumatic experience.
Gregg L. Goodman, LUTCF is the CEO of the Gregg L. Goodman Insurance Agency, Inc. He is an agent for Farmers Insurance and provides life, health, homeowners and auto insurance, as well as commercial insurance programs.
For more information, please call 661-254-6739.