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Resources..
To retain our clients' confidence and trust, AllNation,
Inc. is committed to providing value-added insurance products by
addressing all areas of our clients' needs.
To secure the best return on their investment of time and money,
we are continually working for improvements in our ability to serve
our customers and in the insurance industry's ability to better
serve the public.
What is auto insurance?
Auto insurance protects you against financial loss if you have
an accident. It is a contract between you and the insurance company.
You agree to pay the premium and the insurance company agrees to
pay your losses as defined in your policy. Auto insurance provides
property, liability and medical coverage:
- Property coverage pays for damage to
or theft of your car.
- Liability coverage pays for your legal responsibility
to others for bodily injury or property damage.
- Medical coverage pays for the cost of treating
injuries, rehabilitation and sometimes lost wages and funeral
expenses.
An auto insurance policy is comprised of six different kinds of
coverage. Most states require you to buy some, but not all, of these
coverages. If you're financing a car, your lender may also have
requirements. Most auto policies are for six months to a year. Your
insurance company should notify you by mail when it's time to renew
the policy and to pay your premium.
What is in a
basic auto policy?
Your auto policy may include six coverages. Each coverage is priced
separately.
-
Bodily Injury Liability.- This coverage applies
to injuries you, the designated driver or policyholder cause
to someone else. You and family members listed on the policy
are also covered when driving someone else's car with their
permission. It's very important to have enough liability insurance,
because if you are involved in a serious accident, you may be
sued for a large sum of money. Definitely consider buying more
than the state-required minimum to protect assets such as your
home and savings.
-
Medical Payments or Personal Injury Protection (PIP).-
This coverage pays for the treatment of injuries to the driver
and passengers of the policyholder's car. At its broadest, PIP
can cover medical payments, lost wages and the cost of replacing
services normally performed by someone injured in an auto accident.
It may also cover funeral costs.
-
Property Damage Liability.- This coverage
pays for damage you (or someone driving the car with your permission)
may cause to someone else's property. Usually, this means damage
to someone else's car, but it also includes damage to lamp posts,
telephone poles, fences, buildings or other structures your
car hit.
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Collision.- This coverage pays for damage
to your car resulting from a collision with another car, object
or as a result of flipping over. It also covers damage caused
by potholes. Collision coverage is generally sold with a deductible
of $250 to $1,000-the higher your deductible, the lower your
premium. Even if you are at fault for the accident, your collision
coverage will reimburse you for the costs of repairing your
car, minus the deductible. If you're not at fault, your insurance
company may try to recover the amount they paid you from the
other driver's insurance company. If they are successful, you'll
also be reimbursed for the deductible.
-
Comprehensive.- This coverage reimburses you
for loss due to theft or damage caused by something other than
a collision with another car or object, such as fire, falling
objects, missiles, explosion, earthquake, windstorm, hail, flood,
vandalism, riot, or contact with animals such as birds or deer.
Comprehensive insurance is usually sold with a $100 to $300
deductible, though you may want to opt for a higher deductible
as a way of lowering your premium.
Comprehensive insurance will also reimburse you if your windshield
is cracked or shattered. Some companies offer glass coverage
with or without a deductible. States do not require that you
purchase collision or comprehensive coverage, but if you have
a car loan, your lender may insist you carry it until your loan
is paid off.
- Uninsured and Underinsured Motorist Coverage.-
This coverage will reimburse you, a member of your family, or
a designated driver if one of you is hit by an uninsured or hit-and-run
driver.
Can
I drive legally without insurance?
NO! Almost every state requires you to have auto liability insurance.
All states also have financial responsibility laws. This means that
even in a state that does not require liability insurance, you need
to have sufficient assets to pay claims if you cause an accident.
If you don't have enough assets, you must purchase at least the
state minimum amount of insurance. But insurance exists to protect
your assets. Trying to see how little you can get by with can be
very shortsighted and dangerous.
If you've financed your car, your lender may require comprehensive
and collision insurance as part of the loan agreement.
What if I lease
a car?
If you lease a car, you still need to buy your own auto insurance
policy. The auto dealer or bank that is financing the car will require
you to buy collision and comprehensive coverage. You'll need to
buy these coverages in addition to the others that may be mandatory
in your state, such as auto liability insurance. If you've financed
your car, your lender may require comprehensive and collision insurance
as part of the loan agreement.
Collision covers the damage to the car from an
accident with another automobile or object. Comprehensive
covers a loss that is caused by something other than a collision
with another car or object, such as a fire or theft or collision
with a deer.
The leasing company may also require "gap" insurance.
This refers to the fact that if you have an accident and your leased
car is damaged beyond repair or "totaled," there's likely
to be a difference between the amount that you still owe the auto
dealer and the check you'll get from your insurance company. That's
because the insurance company's check is based on the car's actual
cash value which takes into account depreciation. The difference
between the two amounts is known as the "gap."
On a leased car, the cost of gap insurance is generally rolled
into the lease payments. You don't actually buy a gap policy. Generally,
the auto dealer buys a master policy from an insurance company to
cover all the cars it leases and charges you for a "gap waiver."
This means that if your leased car is totaled, you won't have to
pay the dealer the gap amount. Check with the auto dealer when leasing
your car.
If you have an auto loan rather than a lease, you may want to buy
gap insurance to protect yourself from having to come up with the
gap amount if your car is totaled before you've finished paying
for it. Ask your insurance agent about gap insurance or search the
Internet. Gap insurance may not be available in some states.
Do
I need insurance to rent a car?
When renting a car, you need insurance. If you have adequate insurance
on your own car, including collision and comprehensive, this may
be enough.
Before you rent a car:
-
Contact your insurance company.- Find out
how much coverage you have on your own car. In most cases, the
coverage and deductibles you have on your personal auto policy
would apply to a rental car, providing it's used for pleasure
and not business. If you don't have comprehensive and collision
coverage on your own car, you will not be covered if your rental
car is stolen or if it is damaged in an accident.
- Call your credit card company.- Find out what
insurance your card provides. Levels of coverage vary. If you
don't have auto insurance, you will need to buy coverage at the
car rental counter. The following coverages are available to you
at the rental car counter:
-
Collision Damage Waiver (CDW). Sometimes called
a Loss Damage Waiver (LDW), this coverage relieves you of financial
responsibility if your rental car is damaged or stolen. The
CDW may be void, however, if you cause an accident by speeding,
driving on unpaved roads or driving while intoxicated. This
coverage generally costs between $9 and $19 a day. If you have
comprehensive and collision on your own car, you may not need
to purchase this coverage.
-
Liability Insurance.- This provides excess
liability coverage of up to $1 million for the time you rent
a car. Rental companies are required by law to provide the minimum
level of liability insurance required by your state. Generally,
this does not offer enough protection in a serious accident.
If you have adequate liability coverage on your car or an umbrella
policy on your home/auto, you may consider forgoing this additional
insurance. It generally costs about $7 to $9 a day. If you don't
own a car, and rent cars often, consider purchasing a non-owner
liability policy. This costs approximately $200 - $300 per year.
Frequent car renters sometimes find this more cost-effective
than constantly paying for the extra liability coverage.
-
Personal Accident Insurance.- This provides
coverage to you and your passengers for medical/ambulance bills.
This type of insurance, usually costs about $3 per day, but
may be unnecessary if you are covered by health insurance or
have adequate medical coverage under your auto policy.
-
Personal Effects Coverage.- This provides
coverage for the theft of personal items in your car. However,
if you have homeowners or renters insurance, you may be covered
for items stolen from the car, minus your deductible. You need
to have receipts or other proof of ownership. This type of insurance
usually costs about $1.25 per day. Some rental car companies
combine personal accident and personal effects coverage together
as one type of insurance, while others sell it individually.
The cost of insurance at the rental car counter will vary depending
on the rental car company, state, and location of the dealer and
the type of car you rent. Some rental car companies may check your
credit and driving history and may deny coverage. Check with the
rental car company to find out its policy.
What's
the difference between cancellation and non-renewal?
There is a big difference between when an insurance company cancels
a policy and when it chooses not to renew it. Insurance companies
cannot cancel a policy that has been in force for more than 60 days
except:
- If you fail to pay the premium.
- You have committed fraud or made serious misrepresentations
on your application.
- Your driver's license has been revoked or suspended.
Non-renewal is a different matter. Either you or your insurance
company can decide not to renew the policy when it expires. Depending
on the state you live in, your insurance company must give you a
certain number of days notice and explain the reason for non-renewal
before it drops your policy. If you think the reason is unfair or
want a further explanation, call the insurance company's consumer
affairs division. If you don't get an explanation, call your state
insurance department.
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