You may want to consider uninsured and underinsured coverage for your vehicle. An un/under policy provides financial protection to you if your car suffers damage for which another party is responsible. It applies only when that party lacks enough coverage to cover your losses. In most situations, this type of car insurance is beneficial to you. Do you need to invest in it?
When Does Underinsured Coverage Apply?
Let's say a car accident occurs and the other party is responsible for your losses. You file a claim with their car insurance company. You learn they do not have enough coverage to meet your losses.
In some cases, you would file a lawsuit against the party to potentially get the compensation owed to you. But, if you have underinsured coverage, you can file a claim with your insurance company.
When you insure your car with this type of policy, you gain financial protection for your losses. It will make up the differences where the other person's coverage cannot help you. The policy will have a limit, however. These funds are only available to you when the responsible party cannot cover their losses.
Uninsured auto insurance can also be beneficial. These policies are generally available together as a package. Uninsured coverage applies when the responsible party does not have any insurance coverage.
Who Should Invest in It?
Most people need to invest in underinsured auto insurance if they own a vehicle that is of a high value. If you have comprehensive and collision insurance, adding underinsured coverage is also beneficial. If your vehicle is not worth much, and you can replace it in a significant accident, this coverage might prove less beneficial, however.
If you have a lease or a loan on your car, your lender may require that you maintain this coverage. Check your loan agreements to determine if this is a necessary requirement. Also, some states require individuals to maintain this type of insurance coverage. This differs by state.
It is always a good idea to talk to your Augustine Insurance agent about underinsured and uninsured auto insurance. Do you need it? Could it help minimize risks to you? Accidents can happen to anyone and at any time. When you have protections like this in place, you minimize the losses you could suffer as a result of someone else's negligence.
Talk to your agent about the best level of coverage for this type of policy.