Understanding Your Car Insurance Policy

Often people don’t understand exactly what their car insurance covers until they are involved in an accident.  Many people believe because they have “full coverage” they are protected when they get an accident.  It is important to understand the different kinds of coverage a standard automobile liability policy in Virginia contains and how each of these coverages works.

What is “full coverage” car insurance?

What does “full coverage” mean?  Typically, when an insurance agent or company says a policy contains “full coverage” it means the policy provides both liability and collision coverage.  In other words, if you are involved in an accident that is your own fault, your insurance will pay for the damages to your vehicle as well and any damages you cause to someone else.  In the alternative, if you have only liability coverage and you are involved in an accident that is your fault; your insurance company will not pay for any damage to your own vehicle.  “Full coverage” does not include other types of coverage such as medical expense coverage or coverage for rental or towing expenses.

When an accident occurs, it can sometimes take days, weeks or even longer for the insurance companies involved to determine which insurance company is liable or responsible for the damages caused by the accident.  This can be true even when one driver got a ticket and the other did not.  During this period when the insurance companies are investigating the accident, you may need a rental car to get to work or to doctors’ appointments or you may want go ahead and have your car repaired.  You will not be able to do any of these things if you do not have coverage on your own policy for these items unless and until the other driver’s insurance company accepts liability.

Motorist coverage: uninsured vs. underinsured

Another common misconception some people have about car insurance policies involves uninsured and underinsured motorist coverage.  Many people do not know that if they are involved in an accident caused by someone with no insurance or without adequate insurance, what will be covered depends on the type and amount of insurance coverage on their own policy, specifically, their uninsured or underinsured motorist coverage.  In addition to liability coverage, all standard automobile insurance policies contain uninsured and underinsured coverage.  Most of the time, the amount of your uninsured and/or underinsured coverage is the same as the amount of your liability limits.  What this means is that if your policy has liability limits of $25,000/$50,000, your insurance company will be responsible for paying damages caused by you if an accident is your fault up to the amounts of $25,000 for an individual or damages of $50,000 for the entire accident.  Likewise, if you are involved in an accident that is not your fault and the other driver who is at fault does not have any insurance, your own insurance company will pay damages up to $25,000 per individual and up to $50,000 for the entire accident.

Liability limits for car insurance

You can elect to have liability limits higher than $25,000/$50,000 such as $50,000/100,000, $100,000/$300,000, or more.  By purchasing these higher limits, you not only protect yourself in the event that you cause an accident with damages to someone else exceeding $25,000 for an individual or $50,000 total, but you also protect yourself and anyone else riding in your car if you are in an accident that is someone else’s fault and that person has no insurance or only has limits of $25,000/$50,000.  When you elect for higher liability limits, your uninsured and underinsured limits will also be higher unless you specifically request and acknowledge that you want your uninsured and underinsured limits to be lower.

About The Author: Bridget Long is an experienced trial attorney focusing her practice on personal injury law at Allen & Allen in Petersburg, Virginia. She has handled cases involving car accidents, catastrophic injuries and wrongful death and has litigated cases throughout Virginia on behalf of clients injured due to the negligence of others. She is an active member of the Virginia Trial Lawyers Association and has been named a “Super Lawyer” in Virginia Super Lawyers Magazine for the past seven years.  Bridget is passionate about defending the rights of the injured.