If you’ve been in a motor vehicle accident, you may be curious about what type of car insurance you have. You may also want to understand what type of car insurance another party involved in the accident might have. Automobile insurance helps protect you from breaking the bank when you are involved in a car accident. This article will walk you through the four major kinds of automobile insurance and provide a brief description to help you understand how each may impact your case.
Liability Coverage
North Carolina law requires all registered vehicles to have liability coverage. People found without liability coverage may face large fines or suspension of their driver’s license.
Liability insurance covers both property damage and bodily injury that you may cause to other drivers. It exists to help you pay for damages that you cause and will not cover or pay for your own damages if you are at-fault for an accident. This type of insurance will cover not only the owner of a vehicle, but also family members and any person operating a vehicle with the owner’s permission.
These policies have different limits of liability per person and per accident, called “split limits.” These limits are split into maximum bodily injury liability, total body injury liability, and maximum property damage liability.
For example, North Carolina sets liability minimums that drivers must carry, in a $30,000/$60,000/$25,000 split. Pretend that this is the insurance that you carry. This means that if you were at-fault for an accident, the most one individual could recover from you is $30,000. In contrast, if multiple innocent parties were involved in the accident, payments for all bodily injuries for all the parties cannot be more than $60,000. Lastly, the $25,000 is the maximum amount insurance will pay toward property damage.
Coverage for Damage to Your Vehicle
There are two types of coverage for direct or accidental losses to your covered automobile:
Collision Coverage: This coverage is for physical damage to your vehicle caused by an impact with another vehicle or object. It will pay out the costs of repair or the actual cash value (ACV), whichever is less.
Comprehensive Coverage: This type of coverage protects against damage to your vehicle caused by anything other than a collision. It will pay out the costs of repair or the ACV minus any deductible for damage.
Medical Payments Coverage
Medical payments coverage, also known as “MedPay,” exists to pay for “reasonable and necessary” medical and funeral expenses caused by automobile accidents. Check your policy to see your limits.
Important to note: MedPay does not provide coverage for any expenses that are the result of injuries that occurred on a motor vehicle with less than two wheels.
Uninsured Motorist (UM) Coverage
What happens when you are involved in car accident and the person at-fault does not have insurance? That’s where your Uninsured Motorist coverage kicks in.
UM provides protection when an uninsured driver who is at-fault injures you or another covered individual like your family members, passengers, or anyone you have given permission to use your vehicle. All insurance policies in North Carolina are required to have UM coverage.
Underinsured Motorist (UIM) Coverage
What if you are in an accident and the at-fault driver does not have enough insurance to cover your damages?
UIM provides protection against an at-fault driver who is underinsured and causes you injury. An underinsured driver is someone whose liability insurance limits are less than your UIM limits and not enough to cover the damages they caused in an accident. Underinsured motorist coverage will pay the maximum of the difference between the at-fault driver’s liability limits and your own UIM policy limits.
Important to note: UIM does not provide protection against property damage.
If you or a loved one needs assistance with a personal injury matter in North Carolina, please reach out to a lawyer at Wallace Pierce Law by calling (919) 313-2729 or contact us online for a free consultation. Personal injury claims can be confusing, so don’t wait to get the help you need! The sooner you get started, the sooner you can begin seeking the compensation you deserve.