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Does Your Auto Insurance Actually Cover You?
If you read this whole article, you’ll fully understand what many insurance salesmen don’t. Countless times, I’ve heard someone say, “I have full coverage car insurance,” only to find out they have the bare minimum allowed under Missouri law, plus collision coverage. While this is technically considered full coverage, it’s incredibly inadequate to cover you for any crash that results in a serious injury. Getting the cheapest insurance is often what people want. However, they don’t realize that the more expensive insurance is actually not much more than what they’re already paying — sometimes only $100 or more per year. There are five main types of auto insurance coverage that every driver should be aware of. Underinsured motorist coverage is what I call backup insurance. Underinsured motorist (UIM) coverage is the coverage you buy on your own policy that will pay you if the person who causes your injuries doesn’t carry enough insurance to compensate you adequately. Every person in Missouri should have at least $100,000 per person of this coverage. Driving around without UIM coverage is a big risk: You’re trusting that the person who causes the accident will have enough insurance to fully compensate all your bills and injuries. Most Missourians carry only $25,000 of coverage, and approximately 15 percent don’t carry insurance at all. If you don’t have UIM coverage on your own auto insurance policy, odds are you’ll be stuck with a $25,000 or lower payout after a crash. If you break every bone in your body, you run a high risk of being stuck with that $25,000 to cover your medical bills if you don’t carry this type of coverage.
Liability collision coverage protects you or someone driving your car if you or they cause a crash and damage the vehicle. Similar to what I wrote on liability coverage, I would recommend speaking to a dependable insurance salesman to receive the coverage you need. Medical payments coverage is used to pay for medical bills, even if you are at fault for a crash. You pay extra each month for this coverage. Usually, it’s capped at $1,000 or $5,000 of payout for your bills. If you have health insurance, you don’t really need this coverage, unless you want to carry some to pay your health insurance deductible or copays if you are in an accident. I would recommend to all my clients to have at least $100,000/$300,000 of UM and UIM coverage. The other coverages depend on your personal financial situation and what is suitable for you. Be sure to call your auto insurance agent to discuss your coverages and ensure you’re adequately covered. The increase in coverage might cost slightly more than the cheapest option, but it will make all the difference in the world if you’re involved in an accident.
UIM coverage is often confused with uninsured motorist (UM) coverage, even by insurance salesmen and adjusters. It’s important you make sure your agent understands you want underinsured . This coverage is quite cheap, often costing only $100 more per year. Uninsured motorist coverage covers you if someone causes your crash and doesn’t have insurance or if you’re involved in a hit-and- run accident. These two types of situations are quite common, so you need to make sure you have your own adequate UM coverage to protect yourself. Liability coverage can be tricky. When you or someone you know, such as a family member or friend, is driving your car and ends up in an accident that is caused by you or the person driving your vehicle, liability coverage will cover those costs. I recommend you talk to a trusted local insurance salesman and discuss your insurance needs. They will help you decide what amount of this coverage is appropriate for you.
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