Knowing the basic terms in car insurance will help you have a better understanding of what you?re paying for and how it can be used to help you.
Policy limits and deductibles are two parts of the insurance policy that are extremely important for any responsible insurance buyer to understand because they represent the parts of an insurance claim that?the insurance company doesn?t pay – ?you do!
What are the Auto?Insurance Policy Limits?
Car insurance policy limits are the maximum amount covered by the company in case you have an accident. Here?s an example:
Your policy states that you have a coverage limit of $50,000 in property damage. What happens if you are?considered liabile?for an accident where a $65,000 Porche gets totaled? In an unfortunate situation like this, your insurance company would pay the first $50,000 and you?d be responsible for the remaining $15,000.
Yes that?s right, you?d be responsible for paying the difference!
Bodily injury liability limits often have a ?per-person limit? and a??total limit.? Say you have a bodily injury liability limit with the amount of $25,000 per person/$50,000 per accident. The insurance will not pay any more than $25,000 to any one person injured in the accident and regardless of the number of people injured, the insurance carrier will not pay more than the $50,000 toward all the injuries and medical bills from all the people who were injured in the accident. ?
Our agents at Velox Insurance can help you customize the right amount of coverage to suit your budget and protect your personal assets.
What is the Auto Insurance?Deductible?
Before the insurance company pays to repair damages to?your vehicle, you have to pay a certain amount which is the deductible.
For example, let’s say you have a deductible of?$1,000 on your collision insurance and you get in an accident. You have to pay $1000?before your insurance company pays for additional damages. The insurance company will then cover the remaining expenses as part of your coverage limit.
Choosing a higher deductible can help you save money but it would be best that you ask any of our agents on how to choose the right amount of deductible that could fit your budget and your needs because if you can?t afford the out-of-pocket deductible you could be in a lot of trouble!
Still confused about limits and deductibles? That?s okay. Our agents at Velox Insurance will be more than happy to assist you and help?you understand your policy. Click here to contact any of our agents or give us a call at 1-855-GO-VELOX today!