Liability coverage is the most basic form of auto insurance, required by every state except New Hampshire and Virginia. If the policyholder causes an accident, collision coverage pays for repair work. Comprehensive insurance pays to fix damage caused by weather, vandalism, and accidents involving wildlife. Collision and comprehensive coverage require a deductible that the individual chooses when applying for the policy.
Consumers who are financing a vehicle typically must have collision and comprehensive coverage. That protects the lender from a damage-related financial loss. Many individuals who fully own their automobile also choose these options to reduce their financial risk.
When someone needs to decide which carrier to purchase insurance from, learning about how the company handles claims can be advantageous.
Number of Estimates Required
For instance, does the carrier require more than one estimate for automotive damage repair service? Many require this as a preventive measure against being overcharged. If the vehicle owner has a favorite garage, finding an insurer that allows just one estimate might be a priority.
On the other hand, insurance companies do not insist that policyholders have the automobile fixed at the lowest-priced shop. Instead, they issue a check for that price and the policyholder must pay for the rest. If everything else about the company and the policy is favorable, consumers may still prefer to choose this one.
Claim Payment Recipient
Numerous insurers send the money directly to the garage to make sure the vehicle owner doesn't pocket the cash and never bother with repair work. For the same reason, others send a check to the policyholder issued to both that customer and the automotive repair garage.
Some consumers prefer to work with a company that sends a check directly to the policyholder made out only to that person. They then have the choice of scheduling repair services or spending the money on something else. For instance, it might be used as a down payment for a different vehicle.
Total Loss Considerations
Insurance companies pay for repair service up to a specified percentage of the vehicle's value. If the damage goes beyond that amount, the insurer declares the automobile a total loss. Owners may want to choose a carrier that allows policyholders to keep a car that has been declared a total loss. Some companies write policies giving them the right to take a totaled vehicle after paying the owner the fair market value.
Independent agents and insurance company representatives answer questions about these and other aspects so consumers can make an informed decision.