Auto Insurance Coverages
Depending on the types of coverage you have, auto insurance pays for car repair or replacement, medical expenses, rental cars, towing, court costs, and other expenses.
Read your policy carefully because coverages vary. Pay special attention to who and what is covered by your policy. Also note the exclusions, which are the things your policy doesn't cover. The following are some common exclusions:
- Named driver. Some policies cover only household residents specifically named on the policy.
- Excluded driver. Excludes coverage for people specifically named in an endorsement to your policy.
- Racing. Excludes coverage if you use your car in a racing event.
- Ride-booking. Most policies exclude coverage when you’re using your car for a ride-booking service like Uber or Lyft. Some insurance companies offer policies specifically for drivers for ride-booking companies.
- Intentional acts. Excludes coverage for losses that were intentional.
The front page of your policy – called the declarations, or dec, page – shows the exact name of your insurance company, your policy number, and the amount of your coverages and deductible.
Note: The deductible is the amount you must pay before your insurance company will pay. For example, if you have a claim for $1,000 and a deductible of $300, the insurance company will automatically deduct $300 from the amount it pays you.
Many insurance companies use the Texas Personal Automobile Policy, a standardized policy form that offers eight types of coverages. Companies may sell other policies that the Texas Department of Insurance (TDI) has approved. Some of these policies have more limited coverage. The following summary can help you understand the eight basic auto coverages (please note that your coverages may be different, depending on the type of policy you buy).
1. Liability Coverage (basic liability coverage meets the state's financial responsibility requirement.)
What it pays: The following expenses, up to your policy's dollar limits, for the people in the other car involved in an accident that you or someone covered by your policy caused:
- medical and funeral costs, lost wages, and compensation for pain and suffering;
- car repair or replacement costs; and
- car rental for the other driver while their car is being repaired.
Liability insurance also pays your defense costs, including attorney fees if someone sues you because of the accident. If you are arrested following an accident, liability insurance will pay up to $250 for bail.
Who it covers:
- You and your family members. (Family members include anyone living in your home related to you by blood, marriage, or adoption. This includes your spouse, children, in-laws, adopted children, and foster children.)
- Other people driving your car with your permission.
- Family members attending school away from home.
- Spouses living elsewhere during a separation.
You and your family members might be covered when driving someone else's car – including a rental car – but not a car that you don't own but have regular access to, such as a company car. Some policies provide only liability coverage when you drive a car you don’t own. Physical damage coverage for damage to the unowned vehicle might not transfer. Ask your agent before renting a car or driving a car you don’t own or lease.
Some policies – called named driver policies – won't cover people who live with you, including family members, unless they're specifically named in the policy. For these policies, the declarations page must list the names of the people the policy covers.
If would like more information please contact us,
Suzanne Brown Insurance Agency
A Texas Independent Insurance Agency with over 100 insurance carriers