Types Of Insurance Coverage Available In The US

August 26, 2017 · Posted in General Articles on Car Insurance 
by Mark Walters

What auto insurance coverage is available in the US? This question is often asked and very critical, seeing it is compulsory to have automobile insurance.

The driver may be protected with different coverage types depending on what coverage the insurer purchases. Many states in America demand that automobilists carry liability insurance coverage to cover the expenses in the event of an automobile accident. Some states, such as Wisconsin, have more flexible “proof of financial responsibility” requirements.

Liability insurance covers claims against the policy holder in the US. Generally, any other operator of the insured vehicles, (provided they do not live at the same address as the policy holder, and are not specifically excluded on the policy). In the case of those living at the same address, their names must be specified to be covered on the policy. Thus it is essential, for example, when a family member comes of driving age they must be added to the policy. Liability insurance sometimes does not protect the policy holder if they operate any vehicles other than their own.

When you drive a automobile owned by another person, you are covered under that person’s insurance. Non-owners policies may be offered that would cover an insured on any car they drive. This coverage option is only available to those who are not owners of their own vehicle, and is mandatory by the government for drivers who have been found at fault in an accident in the past. Non-owners insurance policies are also known as Named Operator Policies. The policies are useful for people whose license has been suspended and they have to have insurance for their license to be restored.

Generally, liability coverage covers when you rent a car. Comprehensive insurance policies (“full coverage”) usually also apply to the rental vehicle, although this should be verified in advance. Full coverage insurance premiums are based on, among other factors, the value of the insured’s automobile. However, this type of coverage cannot apply to rental cars because the insurance company does not want to assume responsibility for a claim greater than the value of the insured’s vehicle, assuming that a rental car may be worth more than the insured’s vehicle.

Most rental automobile companies offer insurance to cover damage to the rental vehicle. These policies may be unneeded for many customers as credit card companies, for example Visa and MasterCard, now offer alternative collision damage coverage to rental motorcars if the transaction is processed while utilizing one of their cards. These benefits are restrictive in terms of the types of vehicles covered.

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