Looking for auto insurance coverage in Pennsylvania, New Jersey, or Delaware? We’ve got you covered.
Most of us only think about the damage to our own vehicle as it relates to our auto insurance coverage, but there is more to your auto insurance coverage than just vehicle damage. Your policy is required to cover certain minimum amounts of property damage, bodily injury, and others. If there is a loan on your vehicle, your bank may require additional coverage. In short, auto insurance coverage is not a one-size-fits-all policy, and given the volume of vehicles on the road and the daily distractions we all encounter, car accidents have become a more common occurrence. It’s important that you have the insurance coverage you need in the event you are involved in a vehicle accident.
Know your Auto Insurance Options
It’s important to understand your auto insurance options before you decide on a policy. Collisions happen more than once every minute in the United States, so the odds of being involved in one are not quite as low as we would like to think, so it is important to insure that, if you are involved in an accident, and it is your fault, you’re not exposed to the risk of losing your personal assets. Allied Insurance can help you make sense of all this.
Because Allied Insurance is an independent auto insurance agency, we can compare your current insurance policy coverage with a wide range of insurance providers to secure the best coverage for the best rates. Our approach is simple – we represent you, the client, and not the carrier, so our obligation is to find you the best product for you. We don’t attach fees, overrides, or other charges to the policy, so it costs you nothing to use Allied Insurance.
To help you sort through all the terminology and coverage options involved in an auto insurance policy, we’ve put together a list of the terms and options you’ll most likely encounter with a basic definition of each term. As always, you’re always welcome to call us or contact us here for further clarification.
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Auto Insurance Terms and Coverage Factors
Your insurance premium is determined by a variety of factors, some of which can be controlled, and others which are determined by factors outside of your control. The information below is designed to help explain what many of these coverage terms mean and what effect they have on your insurance.
Tort Option – This is an often misunderstood term. In Pennsylvania, someone purchasing an auto insurance policy must choose either full or limited tort. Tort, in insurance terms, is the civil term for a non-criminal wrong done by someone. A full tort option gives the offended party the ability to sue for unlimited damages, such as pain and suffering. A limited tort option limits the damages to serious injuries. A limited tort policy reverts to full tort if the injuring party is found to be under the influence of a controlled substance, or is not a PA driver.
Collision Coverage — Collision coverage reimburses you for damage to your vehicle in the event of an accident. While not a mandated coverage, lending banks typically require collision coverage for vehicles with a loan or lease.
Comprehensive Coverage — this coverage also protects your car, but in the event that something else damages your car, that is not a fixed, or moving object. For example, theft, a rock that cracks your windshield while you’re driving on the highway, an animal you might hit, and so on.
Property Damage — suppose you damage someones car in an accident, or a guard rail, house, or some other property that belongs to someone else. This is the part of your policy that compensates the other person for that damage
Bodily Injury Liability — this coverage protects your financial interest in the event you injure another party in an accident. This is the part of your policy that pays that other party for their medical bills and related expenses. Due to the high cost of medical care, it’s dangerous to carry liability limits that are too low. This is something we can help you decide on.
Un-insured & Under-insured Liability — this coverage pays you, in the event that you are injured by another party, and that other party was either unidentified, or they weren’t carrying a high enough limit of Bodily Injury Liability to cover your expenses. This is also a very important part of your auto policy because you have zero control over how much insurance other people are driving around with.
Common Auto Insurance Rating Variables
Age — insurance companies use your age in their overall rating algorithms. Drivers who are under 25, and over 65 typically don’t get preferred rates because statistics show that those two age demographics have the most loss frequency and are therefore more at risk for financial loss due to an auto accident
Credit — credit is a metric that has been used in insurance scoring for many years. The better your credit, the more favorable your rates will usually be
Car — the type of car, engine size, safety features, etc.. are all par of the rate of course
Driving History — your driving record and loss history plays a substantial role in the price. If you have a spotty driving history, or multiple moving violations or accidents, chances are, you won’t get a preferred rate until those things are at least 3 years old
Household — insurance companies underwrite at the household level, meaning they try to judge based on the entire household, what the probability of loss will be. If there are multiple drivers in the house who are under the age of 25, that will impact everyone’s pricing in the household