Common Misconceptions – The Differences Between No-Fault Coverage and Liability Only Auto Insurance
Deciding among the many auto insurance options you have can be confusing. While most states, including Texas, require minimum liability auto insurance, many will not provide enough coverage for your needs. There are also come misconceptions about the different types of insurance coverage options. Many people do not understand exactly what liability insurance covers and what it does not. There may also be some misconceptions about what no-fault coverage actually provides.
When selecting an auto insurance policy, your insurance agent will help you understand your options based on your needs. Some of these will include liability coverage, no-fault coverage, comprehensive and collision, and underinsured/uninsured motorist policies.
No-Fault Auto Insurance Policies
No-fault auto insurance policies work to cover the injuries of all passengers in an accident regardless of who is deemed to be at fault. Typically, your insurance company will cover your medical expenses, while the other driver’s insurance company will pay for theirs. Each state defines how these policies work. In some states, drivers are required to add personal injury protection and limit the ability to sue the person at fault for the accident. Two terms you will encounter with no-fault policies are verbal threshold (death or significant disfigurement) and monetary threshold (injuries that exceed a specific dollar amount). As laws and rules covering no-fault insurance policies frequently change, talk with your agent to understand how you are covered.
Most states require minimum liability coverage. However, it is important to understand what this policy actually covers and what it doesn’t. Minimum liability coverage provides protection if you are found to be at fault for an accident. It goes into effect and pays for the damage and medical expenses of the other person up to a certain dollar amount. It does not, however, cover your repair costs or medical expenses. Should the other person decide to sue, or their medical expenses exceed the set dollar amount, you will be held responsible for any additional expenses. For most people, this can be financially devasting. That’s why it’s important to talk with your insurance agent about your needs. A comprehensive and collision policy might provide better financial protection for you and your family.
A comprehensive and collision policy will protect you in a wide variety of events. It will cover you financially if you are in an accident or your car is stolen. It will cover repairs, replacement, and, in some cases, a rental car until your vehicle can be repaired. It goes into effect no matter who is at fault.
Contact Mauceri-Bynum Insurance Agency
Regardless of the type of coverage you select, discuss your options with your insurance agent so that you can make an informed decision. At Mauceri-Bynum Insurance Agency, the agents are ready to help guide you through the process. They will take time to get to know you and your insurance needs before providing you with several options. For more information or to get an auto insurance quote, give them a call at 214-733-8400 or come by and visit our McKinney office today!