Auto Insurance 101
Gene Brooks
Hypothetical Facts
• Sam Adams is driving down Abercorn St.
• Another driver runs stop sign on cross street
• The two cars wreck
What to do?
• Sam Adams in car wreck. • Taken to hospital• Car is towed away• Other driver says, “Don’t worry, I’m fully
covered.”
Insurance Coverages
Insurance Coverages
• Liability• Collision (optional)• Comprehensive(optional)• Medical Payments Coverage (optional)• Uninsured/Underinsured Motorists (optional)
Liability
• Only legally required coverage in Georgia• $25,000 minimum coverage-required– Provides legal representation– Bodily injury– Property damage
• Adam needs to find out about other driver’s coverage
Collision Coverage
• Optional• Covers Sam’s car if damaged• Deductible $500• Ins. Co. option to repair or replace• Some policies provide temporary rental• Would apply if no driver “at fault”
Comprehensive Coverage
• Applies to damage not covered by Collision coverage
• Deductible $100• Does not apply in Adam’s case
Medical Payments Coverage
• Optional• Only for medical bills incurred in wreck• Many policies have $5,000 payment• No subrogation• But none in this policy
Uninsured / UnderinsuredCoverage
Underinsured / Underinsured
• UNINSURED = at fault party has no insurance
• UNDERINSURED = at fault party has insurance but your claim exceeds that insurance
UM might apply
• If other ‘at fault’ driver is uninsured• If Sam’s losses are greater than amount of ‘at
fault’ driver’s insurance coverage• Sam’s insurance company steps into shoes of
‘at fault’ driver
Stacking / Non-Stacking
• Amount of UM available depends on number of autos insured under your policy and insurance on vehicle you are riding in
What happens
• Sam’s medical bills are $20,000 and his lost income is $10,000
• Other driver –underinsured• Sam places his UM company on notice• Claim denied• Sam files lawsuit against ‘at fault’ driver
Auto Insurance 101
Gene Brooks