Most states require drivers to have insurance coverage, or at least urge them to have this policy to help them pay car repairs and property damages caused by accidents.
Most states require drivers to have insurance coverage, or at least urge them to have this policy to help them pay car repairs and property damages caused by accidents.
Types of Insurance Property Coverage
• Property damage liability (PD)
At-fault drivers who damage the property (e.g. cars and houses) of another person can use PD to pay for the repairs or replacement of the damaged property.
Ideally, drivers should have enough coverage of this insurance to cover the damages they might cause to the properties of other people. According to insurance experts, a PD which has a limited coverage may put people at financial risk.
For example, a man has damaged a very expensive SUV and was forced to liquidate his asset just to pay the total amount of the damages he had caused.
• Collision Coverage (CC)
In case the drivers’ cars are damaged by other motorists, CC can help them pay for the cost of repair. However, some experts advise people to drop this insurance if they are using older cars since the coverage is based on the value of the vehicles.
For those who want to lower their insurance premiums, they should offer a higher deductible which is part of a claim the policyholders’ are responsible for paying.
For instance, a driver who set his deductible at $2,000 had spent $3,000 in car repairs. In this case, he will pay $2,000 while his car insurance will shell out $1,000.
• Uninsured Property Damage (UPD)
Policyholders whose cars are damaged by a driver who has no insurance can receive car repair coverage. However, most states provide $3,500 insurance cap or higher, depending on the state law.
When purchasing UPD, drivers should also avail other insurance coverage since this alone will not be enough to cover all the car repair and replacement cost.
People should also realize that UPD only applies to policyholders who are involved in accidents caused by a motorist who has no insurance coverage.
• Underinsured Motorist Property Damage (UMPD)
This insurance coverage applies to accidents caused by a driver whose insurance policy is not enough to cover all the expenses of car repairs or replacement cost.
However, people should also avail other insurance coverage since UMPD only applies to policyholders who are involved in accidents caused by a motorist who is underinsured.
Seeking Property Damages
In case the uninsured and underinsured drivers fail to provide their victims with enough compensation to cover the damages, they may be charged with a civil lawsuit.
