100/300/50 Liability		100/300 UM
PIP		100/300 UIM
$10,000.00 Med		Collision Coverage ACV-$500.00
Comprehensive Coverage ACV-$200.00		Towing
Rental Reimbursement		Conclusion

There are entirely too many insurance agents trying to sell you Auto Insurance that were selling shoes last year and will be selling aluminum siding next year. One of the catch phrases you may hear is that you are buying "full coverage". As a consumer, that phrase can give you a warm & fuzzy feeling which usually does not go away until you have a CLAIM! Then, some adjuster will explain to you why your pending claim is NOT covered. You will surely tell that adjuster "My agent said I have full coverage". Even though that conversation will probably be over the phone, you'll swear you can almost see the adjuster shrug their shoulders as they say "I'm sorry".

Coverage Explanation

When your policy coverage is explained, you should hear terms like "You have 100/300/50 liability, 100/300 UM, 100/300 UIM, 10k med, $500 ded coll, $200 ded comp, towing & rental reimbursement". As an adjuster, that is what I would call ALMOST FULL COVERAGE! Now, lets examine the coverages that have been quoted above . . .


100/300/50 Liability

Liability Insurance pays to someone else for Bodily Injury and/or Property Damage which you may have caused them and for which you may be legally liable. The first two (2) numbers referenced above (100/300) are the policy limits of a potential pay-out to cover your Bodily Injury Liability. Your insurance company will pay up to $100,000.00 to any one (1) person and no more than a total of $300,000.00 to three (3) or more people who may have sustained a Bodily Injury in the same covered accident. The last number (50) means that your insurance will pay up to $50,000.00 to the owner of any property you may have damaged and for which you may be legally liable. When a state has a mandatory insurance law, it is Liability Insurance that is being referred to.
Go back to the top.


100/300 UM

"UM" stands for "Uninsured Motorist" Coverage. This will cover you if you sustain a Bodily Injury in an auto accident in which the other party was at fault and the other vehicle was uninsured. Like the "100/300" part of the "Liability" example referenced above, this coverage pays only for Bodily Injury . . . NOT Property Damage. You would be able to collect from your own insurance company what you would have been able to collect from the other driver's insurance company for your Bodily Injury. The numbers "100/300" represent the limits of what the insurance company will pay to any one (1) insured ($100,000.00) or no more than $300,000.00 in total to three (3) or more injured insureds.
Go back to the top.

PIP

Personal Injury Protection pays for medical expenses and other basic out-of-pocket expenses of the driver and/or passengers of a covered vehicle that are injuerd as a result of an accident. This type of insurance is required in states with No-Fault insurance laws. In many other states it is offered as optional coverage.
Go back to the top.


100/300 UIM

"UIM" stands for "Under Insured Motorist" Coverage. Like "UM" coverage, this coverage will benefit the insured if he/she sustains a bodily injury in an auto accident where the other vehicle is at fault. If the other driver HAS insurance but NOT ENOUGH insurance to pay you FULLY for the value of your Bodily Injury Claim, the benefits of your UIM Coverage become available to you. Your UIM Coverage will pay you the difference between what your Bodily Injury Claim is FULLY worth and the policy limits you collected from the other insurance company (up to your policy's individual and/or aggregate coverage limits). If you sustained a Bodily Injury in an auto accident and you collected from your own UM coverage, you MAY be able to also collect under your UIM coverage as well. This is referred to as "stacking". In some states and dependent upon some policy verbage, it may well be possible to "stack" your benefits. To get a more specific answer to your specific situation, we recommend you contact a Local Expert attorney in your area.
Go back to the top.


$10,000.00 MED

The term "MED" as used in this example typically stands for "Auto Med-Pay Coverage" and the dollar amount noted reflects the maximum benefit amount collectable by any one (1) insured for each covered accident. This coverage is designed to reimburse an insured for treatment expenses incurred due to an auto-accident-related injury (regardless of who may have been at fault in the accident). Special note:  Whether the Med-Pay coverage on your auto policy is proprietary, surplus, subrogatable, limits the definition of "insured" or has coverage limits relative to accident circumstance (vehicle occupant vs. pedestrian) can vary from state to state and even insurance company to insurance company. We recommend you clarify what Med-Pay limits may apply to your coverage when you are buying your policy. If your agent can't SHOW you the answer to your question . . . get yourself another agent!
Go back to the top.


Collision Coverage ACV-$500.00

Collision Coverage is designed to protect your VEHICLE against loss or damage from a collision. The "ACV- $500.00" part means the most your insurance company will pay to you is the ACV (Actual Cash Value) of your vehicle LESS $500.00. If the cost to repair the covered damage to your vehicle is less than the ACV, your insurance company will pay for the cost of repairs LESS $500.00. Collision Coverage is typically based upon ACV limitations. However, some insurance companies offer RCV (Replacement Cost Value) Collision Coverage. This means the potential maximum benefit you may collect under this coverage is increased to what it would cost to REPLACE your existing vehicle . . . NEW! As the potential maximum benefit is greater with RCV Coverage than with ACV, so is the premium higher for RCV Coverage. Nonetheless, we wanted you to know that RCV coverage is probably available to you. We will go into greater detail about the distinctions between RCV and ACV Coverages on the Auto Claims page.

Comprehensive Coverage ACV-$200.00

Comprehensive Coverage is designed to protect your VEHICLE against loss or damage from other than a collision (fire, theft, vandalism, flood, glass breakage, etc.). The "ACV-$200.00" part means the most your insurance company will pay to you is the ACV (Actual Cash Value) of your vehicle LESS $200.00. If the cost to repair the covered damage to your vehicle is less than the ACV, your insurance company will pay for the cost of repairs LESS $200.00. Comprehensive Coverage is typically based upon ACV limitations. However, RCV Coverage is also available as described in the Collision Coverage paragraph above. Most insurance companies will offer (for a slight add'l premium) "0" deductible on Safety Glass Breakage. This means that if your windshield is damaged, your Comprehensive Coverage will replace the windshield at no cost to you. We recommend you consider this optional coverage.
Go back to the top.


Towing

Towing Coverage is simply that. Your insurance company will reimburse you (or accept direct billing) for the cost of towing the insured vehicle from a place of breakdown to the nearest appropriate service facility. Most insurance companies have a maximum limit they will pay out on Towing Claims but some companies have virtually no maximum limit, so check this out when you buy your policy. Most insurance companies will only offer Towing and Rental Reimbursement Coverage if the insured vehicle already has Collision and Comprehensive Coverage with that same company.
Go back to the top.


Rental Reinbursement

If your insured vehicle is disabled because of a loss covered under Collision or Comprehensive Coverage, Rental Reimbursement Coverage will reimburse you for the cost of renting a temporary substitute vehicle while your insured vehicle is out of service. This coverage usually has a maximum $ limit per rental day, as well as a maximum $ limit per loss occurance. Daily and occurance limits can vary greatly from company to company. Be aware of these limits when you buy your policy. We recommend you consider including this coverage with your Auto Insurance Policy.

If your Auto Insurance Policy has ALL the coverages explained herein you will have what could be considered "FULL COVERAGE"! The limits of coverage and amounts of deductibles will vary on a situation to situation basis. The need for Collision, Comprehensive, Towing and Rental Reimbursement Coverages should be based upon weighing the value of the vehicle to be insured against the cost of the premiums for those coverages. However, ALL OTHER COVERAGES REVIEWED HEREIN ARE RECOMMENDED AS A MINIMUM ACCEPTABLE AUTO INSURANCE POLICY!
Go back to the top.


Conclusion

You should now have a basic understanding of Auto Insurance Policy Coverages and should be better prepared to decide which coverages you wish to have included in your Auto Insurance Policy. SUGGESTION:  Dig out your current Auto Insurance Policy and review it in light of what you have learned here. You may have some deficiencies you will want to address IMMEDIATELY!

Insurance Quotes USA recommends calling our Local Expert for help.

Copyright by Insurance Consumer Advocate Network
Reprinted with permission