Auto insurance coverage is an essential component of responsible car ownership. However, navigating the world of auto insurance can be confusing given the wide range of coverage options and terms. In this article, we will explore the different elements of auto insurance to help you determine whether you have adequate coverage.
"Full coverage" is not an official term and does not guarantee that you have adequate coverage."
Liability Coverage: Coverage for the other person(s) and their vehicle if you are at fault in an accident. Terms of liability coverage include:
Bodily injury coverage
Property damage coverage
Liability coverage is a type of auto insurance that covers damages and injuries to other parties when you are at fault in an accident. It does not cover damages to your own vehicle or injuries sustained by you or your passengers.
In Georgia, state law requires every driver to carry at least 25/50/25 liability coverage. This means that if you are at fault in an accident, your insurance will pay up to $25,000 for injuries to one person, up to $50,000 for injuries to multiple people, and up to $25,000 for property damage to the other party's vehicle or other property. However, this is the bare minimum, and we usually advise people, especially those with substantial assets, to carry a higher limit. This is because if your limits are not high enough to cover the other party’s damages, they could potentially pursue a judgment in excess of your limits and ultimately go after your personal assets, bank accounts, etc. This is not a typical scenario, but definitely something to keep in mind.
UM/UIM Coverage: Coverage for you, members of your household, and occupants of your vehicle at the time of a collision. Terms of UM/UIM coverage include:
Bodily injury coverage
Only applicable when the other party is at fault
Particularly important for:
Hit and runs
When the other party is uninsured
When the other party is underinsured (i.e., not enough insurance coverage to cover the cost of the collision)
Uninsured/Underinsured Motorist (“UM/UIM”) coverage is optional auto insurance coverage that protects you when you are involved in a collision with an at-fault driver who does not have sufficient insurance coverage to pay for damages and/or injuries. It can also provide protection when you are involved in a hit-and-run accident where the at-fault driver cannot be identified or located. UM/UIM coverage typically pays for medical expenses, lost wages, pain and suffering, and other damages resulting from the collision.
In Georgia, UM/UIM coverage is not mandatory, but state law requires insurance companies to offer it to policyholders. Furthermore, the policyholder must specifically reject it in writing if they do not wish to purchase it. (It’s that serious!) The minimum UM/UIM coverage limits that insurance companies are required to offer in Georgia are 25/50/25.
UM/UIM Coverage (Property Damage): Coverage for your vehicle only.
Only applicable when other party is at fault
Comprehensive Coverage: Covers non-collision damage to your vehicle. Terms of comprehensive coverage include:
Damage to your vehicle caused by situations such as vandalism, fire, falling objects, etc. Windshield damage is a common example
Typically does not include collision coverage
Comprehensive coverage is an optional form of auto insurance coverage in Georgia that provides protection for damages to your vehicle caused by events other than collision. For example, damages arising from theft, vandalism, fire, hail, flood, riots, and broken glass would all be covered under comprehensive coverage.
Comprehensive coverage, when added to an insurance plan, is what some people typically mistake for having "full coverage" insurance. However, full coverage is not an official term and does not guarantee that you have adequate coverage. While we recommend having comprehensive coverage, it does not mean you are fully covered by your insurance policy.
Collision Coverage: Covers damage to your vehicle when you are at fault.
Collision coverage is an optional form of insurance coverage in Georgia. (If you haven’t noticed yet, everything that will directly help you when an accident happens is optional. Go figure!). However, if you have a car loan or lease, your lender or leasing company may require you to have Collision coverage as part of your auto insurance policy to protect their financial interests. If you own your vehicle outright, Collision coverage is optional, but it can provide valuable protection in case of a collision.
This type of coverage typically covers damages to your vehicle resulting from:
Collision with another vehicle: If your vehicle is involved in a collision with another vehicle, whether it's a rear-end collision, a side collision, or a head-on collision, collision coverage can help cover the damages. This coverage is particularly important when you are the one at-fault, because you won't have to pay more than your deductible put of pocket.
Collision with an object: If your vehicle collides with an object, such as a tree, pole, or barrier, Collision coverage can help cover the damages.
Single-vehicle accidents: If your vehicle is involved in a single-vehicle accident, such as when you hit a curb or a pothole, Collision coverage can help cover the repair costs.
Medical Payments Coverage: Covers at least a portion of your medical bills even if you are at fault for the collision.
Can be used in conjunction with other insurance policies
Typically limited to a specific dollar amount
Medical Payments coverage (“MedPay”) is another optional insurance coverage in Georgia. MedPay coverage can help alleviate some of the financial burdens that arise from car crashes, including ambulance fees, hospital stays, surgeries, X-rays, and other diagnostic tests. In some cases, it can also include chiropractic care, physical therapy, and other rehabilitation services. Most importantly, MedPay can be used in conjunction with other insurance policies. However, MedPay coverage is not a substitute for health insurance. It simply provides additional coverage for medical expenses after a crash. MedPay coverage is typically limited to a specific dollar amount per accident, so be sure to review your policy carefully to understand the limits of your coverage.
Roadside Assistance/Emergency Road Services: Covers at least a portion of roadside emergency services.
Roadside Assistance coverage is an optional type of insurance coverage in Georgia. This coverage is usually helpful when you have a roadside emergency that may leave you stranded, like a flat tire, dead battery, or a mechanical breakdown. Some of the most common services include towing, fuel delivery, jump-starts, and lockout assistance. Some policies may also include additional services such as battery replacement, tire changes, and winching services.
The key benefits is that this coverage can save you a significant amount of money in a roadside emergency. When considering a roadside assistance policy, it is important to carefully review the terms and conditions of the policy to ensure that it meets your specific needs. Some policies may have restrictions on the distance that a vehicle can be towed, or may only provide a limited number of service calls per year. It is also important to understand any additional costs associated with the policy, such as deductibles or service fees.
Car Rental Travel Expense Coverage: Covers the cost of renting a vehicle while your car is being repaired.
Typically has a daily and/or capped amount of coverage for the rental period
Car Rental and Travel Expense coverage, which may also be known as Rental Reimbursement coverage, is an optional type of coverage you can add to your automobile insurance policy that covers the cost of renting a vehicle while your car is being repaired after a crash. The coverage limits and requirements tend to vary depending on the insurance company and policy, so it's essential to read your policy carefully to understand exactly what is covered and what is not covered. This coverage usually has a daily and/or overall limit meaning that the insurance company will only pay up to a certain amount per day or for the entire rental period. I have seen this coverage come in handy for clients when there is a delay by the at-fault party’s insurance time and time again.
So, do I need ALL of the coverages mentioned? Not necessarily, but you should certainly have more than the required Liability coverage. Here are the recommended must-have coverages recommended by The Adebayo Law Firm:
Adebayo Law Must Haves:
UM/UIM coverage
Collision coverage
Car Rental and Travel Expense coverage
MedPay
While our recommendations are a starting point for the amount of coverage you should have, you should also consider additional coverages to decrease the possibility of unexpected expenses and disruptions to your daily life.
Still not sure if you have enough coverage? Fill out our Contact Form to set up a free call with an attorney to review your coverage and provide recommendations.
If you have been in a car crash and want to speak with a personal injury attorney, give us a call for a free, no-obligation consultation.