Vehicle insurance is very confusing! IF you don’t understand what different types of insurance coverage mean, you could be leaving you or your family exposed to financial loss or ruin. In this article, I will cover different types of coverage and some of our thoughts on each type.
Bodily Injury Liability Insurance
This insurance protects you from claims made against you which you are obligated to pay if you cause bodily injury to someone else in a crash. This also covers your defense costs if you are sued. Bodily Injury Liability limits usually specify two dollar amounts, the first amount limiting payments to a single person per accident and the second amount puts a cap on the total amount of payment for all persons injured per accident. The Nebraska minimum required limits are $25,000.00 per single person and $50,000.00 total coverage for all persons injured. THIS IS NOT ENOUGH. Due to the current high costs of medical treatment, household overhead and higher salaries that need to be replaced.
Collision coverage pays for the damage to your vehicle by collision with another vehicle or fixed objects like trees, signs, buildings, etc. This coverage is what gets invoked when the accident is your fault. You need this coverage if your vehicle is worth more than $2,000.00 to $3,000.00, and this coverage will normally be required if your vehicle is financed.
Comprehensive Coverage Insurance
This is your “fire and theft” coverage, and also covers damage to your car for anything other than a wreck, like tornados, floods, vandalism, theft, hitting a deer, rock in windshield, etc.
If your vehicle is getting repaired, policies with this coverage will pay a designated amount per day for a designated number of days; or some maximum dollar amount to rent a car, while you wait for completion of repairs. If you need a vehicle for your day-to-day life, this coverage is a must.
This insurance covers medical expenses from accident injuries and covered persons in your car, no matter who is at fault. If you or your passengers do not have health insurance coverage, this coverage is also a must. Different monetary amounts of coverage levels are available and medical payments coverage may have no relation to “full” or collision/comprehensive coverage and whether or not you have those coverages.
If your car breaks down or is involved in an accident, this coverage will pay for a tow truck or roadside assistance to get your car to the repair shop, body shop, or salvage yard. This coverage usually pays up to $75.00. This is a nice addition if not too pricey, and not needed if you annually purchase some other type of roadside assistance coverage.
Underinsured or Uninsured Motorist
I think EVERYONE should have this coverage at a higher level than state minimums, because it protects us from all of the unseemly folk out there who refuse to insure their cars, OR purchase inadequate insurance coverage. In Nebraska, you have to show proof of insurance to renew your tags, however many people just take out a policy, send in proof to the state, and then let the policy lapse after a month and are uninsured. Underinsured Motorist pays for your injuries up to the policy limit when the other driver has insufficient insurance coverage which is not enough to pay for your injuries. This coverage usually includes hit and run drivers as well. Uninsured coverage pays for your injuries when the other driver has no coverage or lapsed coverage.
The Nebraska minimum requirements for this type of coverage are also the VERY INSUFFICIENT $25,000.00/$50,000.00, for the same reason these coverage levels are not adequate liability insurance coverage amounts.
This coverage provides additional ($1,000,000.00 or more) blanket coverage to your liability, underinsured, and uninsured coverage limits you have in place. This coverage is very important if you have significant income to replace if you are injured, or if you have significant debts and overhead (household, children, motorcycles, boats and other recreational assets, etc.) at this point in your life.
The amount of vehicle insurance needed is unique to each individual. Inserra & Kelley strongly recommends NO LESS THAN $100,000.00/$300,000.00 coverage on your vehicle for liability, underinsured and uninsured coverage.
PLEASE take this article to your insurance agent for a policy review, and make sure that you have enough coverage to insure you and your family in the event that a significant accident impacts your life!!! You would be amazed at how little some of this additional coverage will cost!
A partner with Inserra & Kelley, Attorneys At Law since 1993, Craig Kelley focuses on personal injury law with a large emphasis on motorcycle and bicycle related cases and claims with the goal of first helping clients heal and then getting speedy resolution of their disputes.