The following is a list of terms that are often found on auto insurance policies and their meanings.
Lets look first at required automobile insurance in Missouri and Kansas!
- Liability Insurance: Basic car insurance. It covers your bodily injury and property damage when you have been involved in a car accident caused by another person. If the accident is your fault, it protects your assets by paying for the other party's injuries and property damages up to the limits of the policy.
- Uninsured Motorist Coverage: This insurance coverage applies when you are involved in an accident caused by an uninsured driver. You would make a claim against your own insurance for your bodily injuries even though the accident was not your fault. However, this does not cover property damages (Kansas also requires underinsured motorist coverage, which will be discussed below).
- Personal Injury Protection (Referred to as PIP or no-fault): This provides payment for medical expenses, lost wages and more. Regardless of who is at fault for the accident, this coverage applies. You make the claim to your own insurance. PIP must generally be repaid if you recover from a responsible third party. When you have an attorney, your insurance pays a pro rata share of the costs of recovering from a third party and the amount that you must repay is reduced.
Now lets look at optional automobile insurance coverage:
- Underinsured Motorist Coverage (UIM): Although not required in Missouri, this coverage is required in Kansas. It offers additional coverage when a responsible third party does not have sufficient insurance to cover your damages, i.e. your losses exceed their policy limits. In Kansas, keep in mind that your underinsured motorist coverage must exceed the liability limits of the other party. For example, it will not kick in if your UIM coverage is only $25,000 and the other party's liability policy limits are only $25,000. In Missouri, because UIM coverage is not required, your insurance carrier is able to place more limitations on your optional UIM coverage than your mandatory UM coverage. The laws and the insurance policy provisions pertaining to UIM coverage can be very complex and should contact our office with any questions.
- Medical Payments: This is optional coverage in Missouri but does not apply in Kansas, which has PIP coverage. In Missouri, you can opt to select medical payment insurance coverage to pay for your medical costs and possibly funeral expenses up to the amount stated in your policy. You turn the claim into your own insurance regardless of who is at fault. This may or may not have to be paid back if you recover from a responsible third party. This will also cover other passengers in your car.
- Comprehensive Insurance: This provides coverage when your car has been damaged by theft, vandalism, storms, fire, and more. A deductible is usually required.
- Collision Insurance: Provides coverage when your car is damaged in an automobile collision. This offers protection regardless of who is at fault, but usually involves a deductible. If another party is at fault, you may be able to recover your deductible.
There are additional terms and coverage you should be aware of. For more information, please read Car Insurance Terms Everyone Should Know and Understand Part 2.