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You’re driving down the road minding your own business when – WHAM! – you are involved in an auto accident. Maybe it’s not your fault, maybe it is. After checking to see if all parties are OK, your next thought is probably about your auto insurance. But are you really covered? Before you find out the hard way, consider these questions inspired by a positing on the Insurance Information Institute (III) website:
Are you driving your personal auto for business? If you are self-employed and use your vehicle for business purposes, personal auto insurance may not protect you. While auto insurance geared for businesses can be more costly than a personal policy, one of the best ways to keep your auto rates down is by having a good driving record. If there are others, such as employees, using your car make sure they also have good driving records. Check the records of your employee drivers at least twice a year to ensure they maintain a clean driving record.
Is someone else driving your car, even if you are a passenger? If other people drive your car, their auto insurance will cover them in the event of an accident. In most states, the auto insurance policy covering the vehicle is considered the primary insurance, which means that the owner’s insurance company must pay for damages caused by an accident. Be smart when letting someone else drive.
Do you just have minimum liability limits? Chances are that you will need more liability insurance than the state requires because accidents often cost more than the minimum limits. Your insurance will cover you only up to the limits of your policy. You need to purchase liability coverage AND both collision and comprehensive coverage in order to fully protect your vehicle from all types of damage.
Why take a chance on being under-covered, or not covered at all. Sit down with your insurance professional and discuss your policy limits and what you need to do to insure you have the coverage you need.