Car Insurance Coverage Explanation

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Car insurance coverage works in a few different ways depending on your policy. Find out about car insurance coverage with help from a fee-based insurance and risk management consultant in this free video clip.

Part of the Video Series: Auto Insurance
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Video Transcript

Hi, I'm Dan Weedin. I'm a nationally recognized insurance consultant, and today we're going to talk about car insurance coverage. Now, you may be watching television commercials and insurance companies are all over the place talking their coverages. If you're new to buying insurance this might be very important for you, however even if you've been buying car insurance for years. An explanation of what the term coverage really means might be important to you. So let's start at the top with liability. Liability coverage means that if you are responsible, negligent, if you're responsible for somebody else getting hurt or property being damaged, the other car. Then the coverage is the amount of money available from the insurance company to the other person to ether fix their car or to fix them. Coverage comes out like a hundred thousand dollars or three hundred thousand dollars. Often times you'll see something called split limits, which means they'll pay a hundred thousand dollars per person that's been hurt or three hundred thousand dollars for everybody who was in the car. This coverage can be very complex and I highly, highly recommend that you spend time with your insurance agent, talking about what it means and how much you should have. Coverage really pertains to the amount that you have available. Whether it's a hundred thousand dollars or five hundred thousand dollars. That's the amount that's going to pay for somebody else who has been damaged because of your negligence while driving a car. Other coverages include something like comprehensive and collision this coverage applies to your vehicles and in this case coverage means, what your deductible is. Somebody is going to, the insurance company is the one who's going to pay to have your vehicle fixed. The coverage often come down to how much are you going to share in that through your deductible. Comprehensive deductibles are usually lower and less expensive than collision, because collision cause larger amounts of, of damage and it costs more to fix. So when you hear the term coverage in that situation you're talking about deductible. Finally uninsured motorists is very similar to your liability, except in this case the coverage or the amount that your, is going to be paid out, comes back to you. The other person who was involved it was their responsibility, they didn't have enough insurance coverage in place so your insurance coverage, a hundred thousand, three hundred, five hundred comes into play then. The bottom line and the thing I think you need to remember is that coverage normally talks about the amount of money that's available to ether pay somebody else, because you're negligent or to pay you because somebody else was or nobody was. Coverage really means money. Again, I'm Dan Weedin, and today we talked about what coverage in auto insurance means. Thanks for watching.

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