What You Need to Know: Property Damage and Comprehensive Coverage

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Understanding Auto Insurance: What You Need to Know About Property Damage and Comprehensive Coverage

If another driver on the road hits your car and is at fault, their insurance should cover damage to your vehicle and personal property.  If the damage to your vehicle is sever, your vehicle may be deemed a total loss. Because insurance companies have a reasonable period of time to investigate and determine fault, this may mean you could be without a car.

If you have “full coverage” on your own vehicle, often your own insurance may provide a rental and pay for the value of the car, less any deductible. When your own insurance company pays, they will then seek to be reimbursed by the at-fault driver’s insurance company, and this includes obtaining the deductible for you.  Some of the issues that arise when dealing with property damage claims include: when the value of the vehicle is less than any loan on the vehicle (gap insurance, which is typically offered at the time the loan is made, covers this difference in value because the at-fault driver is only responsible for reimbursing for the value of the vehicle); when the at-fault driver’s property damage policy limit is less than the value of the car; and when the value of a vehicle that is not deemed a total loss is less simply by virtue of the fact that the vehicle has been involved in an accident.

GAP Insurance

When taking out a loan to purchase a vehicle, often times the vehicle depreciates more quickly than the loan balance is paid down (this is especially true for brand new vehicles).  As a result, the balance of the loan can often exceed the value of the vehicle. If your vehicle is totaled in an accident and the other driver is at fault, the other driver is only responsible for paying for the value of the vehicle, not the balance of the loan.  Unfortunately, the result is that your vehicle could be totaled and you could still be liable for the portion of the loan that exceeds the value of the vehicle. Gap insurance is optional coverage that addresses this situation and is intended to pay off the remaining balance of the loan.  Some lenders require gap insurance, but regardless it is always prudent to purchase gap insurance to make sure you are covered.

Minimum Property Damage Coverage in Kansas and Missouri

In Kansas and Missouri, auto insurance is mandatory. In Kansas, you must have at least $25,000 in property damage liability coverage, while in Missouri, you must have $10,000 in property damage liability coverage. The at-fault driver’s liability insurance should be at least this minimum.  Many drivers have coverage that exceeds the minimum limits required under state law. If the at-fault driver’s policy limits are not enough to cover your property damage, your own policy may provide coverage if you have “comprehensive coverage.”


What is Comprehensive Coverage?


When people say that they have “comprehensive coverage,” what they typically mean is that they have insurance coverage for the damage to their own vehicle.  This property damage coverage provides compensation to pay for repairs, pay for the value of the vehicle if it is a total loss, and pay for a rental car. This coverage can also apply to pay for the damage to your vehicle caused by another person if the other’s person’s limits are not high enough to cover all of the damage.  If you use your comprehensive coverage, you will have to pay a deductible. The amount depends on your specific policy.


Diminution of Value Claims


Often times, following an accident, your vehicle may be worth less than it was before the accident, even after complete repairs, simply because it was involved in an accident. If you were to try to sell the vehicle, most buyers, dealers, and used car shops would be reluctant to pay full price for a vehicle that has been involved in a serious accident. If you’re in this situation, a personal injury lawyer can help file a diminution of value claim, which usually involves the use of an expert, to hold the at-fault driver responsible for the reduced value of your car.


Contact Your Personal Injury Lawyer First


It is always prudent to speak with an attorney before talking with an insurance company or filing a claim for personal injuries or property damage.  If you have been involved in a car accident, or if you want to talk with an attorney about adequate insurance coverage, call Aaron House today for a free consultation at 816-875-4260.

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