Some Important Insurance Coverage Concepts You Should Know

Coverage and Limits:

• Liability: Any type of insurance policy that protects an individual or business from the risk that they may be sued and held legally liable for something such as malpractice, injury or negligence. Liability insurance policies cover both legal costs and any legal payouts for which the insured would be responsible if found legally liable. Intentional damage and contractual liabilities are typically not covered in these types of policies.

• Bodily Injury: Damages to third party when insured is at fault: Medical bills, loss of income, pain and suffering, and other results of the physical harm incurred.

• Property Damage: Physical injury to tangible property (third party) when insured is at fault: including loss of use of such property. This coverage is mandatory in the state of Florida. (Damages to another vehicle, house, electrical poles, a fence, etc.).

• Medical Payments: Pays expenses incurred for necessary medical and funeral services to persons injured by accident, without regard to fault or legal liabilities.

• Uninsured Motorists: This coverage is a form of coverage to pay compensatory damages for bodily injuries, under one’s own policy, for amounts which would otherwise have been recovered from the liability insurance of another (when the injured is NOT at fault). Uninsured Motorists is not intended to duplicate payments otherwise available.

• Stacked or Non-Stacked: Stacked coverage means the coverage limits provided for two or more vehicles are added together to determining the limit of insurance coverage available to an injured person in any one accident; while the Non-Stacked is available to a person injured while occupying a motor vehicle is only the limit applicable to that motor vehicle.

• Personal Injury Protection (PIP): Personal injury protection (PIP) can cover expenses related to injuries you sustained in a covered accident. These expenses can include medical and hospital bills as well as expenses not covered by your health insurance. Coverage will vary depending on the state you live in, and it can be a great supplement to your health insurance.

>> The law requires that PIP insurance be carried by the owners of motor vehicles, and imposes penalties for failing to do so.

• Comprehensive: Cover the damages to the insured’s vehicle for Other than Collision like: fire, theft, vandalism, falling objects (hail), explosion, windstorm, flood, contact with animal or bird, breakage of glass.

• Collision: Upset (overturn) or impact with another object.


• Eligible types are a private passenger auto and a pickup or van that has a Gross Vehicle Weight of less than 10,000 pounds and is not used for work. The eligible vehicle may either be owned by the insured or long-term leased for a period of six month or more.


• To insure the vehicle under a Personal Auto Policy, the vehicle must be registered under a person’s name; not all insurance companies accept vehicles under a corporation’s name under a Personal Auto Policy.

• For some companies the insured must be registered owner(s) of the vehicle, and the policy cannot be written under one of the driver’s name.


• Determined by the address (zip code) where the vehicle is garaged.

• If there is more than one vehicle on the policy, they can be rated in different territories depending on the garage address. i.e.: Students away to college.

Driver Classification:

• The age, sex, and marital status of the operators, and how much they drive the vehicle(s) determine the driver classification.

• Rates are highest when the principal operator is a youthful unmarried male and lowest when they are no youthful operators.

• All drivers of the household have to be listed on the policy and are considered to rate it; or they can be excluded, but a premium will be charged.

Driving Record:

• Points are assigned for at fault accidents and major (serious) traffic violations during a prior three year period. Points are counted different then in the Driver License.

• Drivers with their License Under Suspension are not acceptable by some companies, and a License with Suspension (already Reinstated) are also considered to determine the premium of the policy. They lose the entire safe driver discount.


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