You have probably dealt with enough insurance companies to know that the coverage you have is all in the wording. Just because you think something should be covered does not mean that it is. You must read your entire contract before agreeing to it. If you choose not to, you may have a big surprise if you try and make a claim. That surprise being a denial because of non-coverage.
You need to make sure to read through a few specific areas, even if you have read the entire thing a couple of times. You will want to pay close attention to 5 important components of your comprehensive car insurance policy wordings that could come back to haunt you.
If you do not understand a section of the policy, do not be afraid to ask questions. If you are unsure what their terminology means, look the word up. Never skip over wording that you do not know because it could be the one word that changes your policy’s coverage.
- Liabilities To Third Parties – The first section that you need to check out is the liabilities to third parties. This is one of the aspects of car insurance that you are legally obligated to have, and the area you are in will set the parameters you need to follow. The first thing you should do when reading through your policy is to see if this has been included. If not, you need to know why. If it is, you need to scan through the exclusions and additions.
- The Own Damage Section of Comprehensive Insurance – You may think that this section of the contract would be self-explanatory. In a way, it will be. That can only happen if you read through the entire section and remember it for later. You never know when you may have to file a claim. Make sure that you are carrying a good enough policy to cover the cost of replacing your car and fixing any problem that you may have from an accident.
- Insured Declared Value (IDV) – This section of your comprehensive car insurance policy explains how much the company will pay for a car that has been totaled. If it will need to be replaced. The most common way for them to figure out the value of your vehicle at the time of the accident is to take the current market value and go with that. This may not be the best news because a new car loses value as soon as you drive it off the lot. Still, if you can make some additions to your policy, that will change this number to match the amount you paid for the vehicle.
- Personal Accident Coverage – This section of your policy will include a table (most of the time) that will detail how much coverage you have for personal injury. For instance, if you lost an arm in an accident, you would want to know how much of your medical bills they will pay. When getting the policy set up, you need to read through this section carefully and keep it in the back of your head, just in case.
- General Exceptions – This section of your auto insurance can cause you some serious problems when you try and file a claim. Your insurance carrier will list all the exclusions they will include in your policy. Which could be things such as not covering an accident of you traveling outside of their coverage area. Granted, if you drive to a different country, this is to be expected, but it may surprise you to know that it could happen if you go outside of the state that you live in.
These are the 5 most essential areas of wording on your comprehensive car insurance policy that you need to focus on. As was mentioned earlier, you should read the entire contract that you have obtained to make sure that you know all the specifics. Nothing is more frustrating than filing a claim just to be denied because you were not covered. Read everything, including the small print, and ensure that the policy covers what you need it to cover.