Watch a few minutes of national television and you’re likely to come across a commercial for car insurance.
When you hear the same story again and again, it’s easy to assume all carriers provide the same coverage. But when family safety and asset preservation are top priorities, it becomes more important to seek out distinctions that align with your lifestyle.
Consider these scenarios:
- If your car was totaled in an accident, would your insurer pay the full value specified on your policy or recalculate its value due to depreciation?
Cars lose about 10% of their value as soon as they’re driven off the lot (according to Edmunds.com). Depreciation continues from there. If you insure vehicles on an “actual cash value” basis, your claims payout may be much less than you would expect in the event of total loss. A better solution is “agreed value” coverage, but few insurers offer that.
- It’s going to take three weeks to repair your luxury-brand sedan. With your current insurer, can you rent the same brand of car throughout that time frame?
Repairs to higher end vehicles are often more complex and take longer to complete. The typical policy offers about $30 per day for rental reimbursement—likely not enough to keep you in a vehicle on par with the one you own.
- Are aftermarket parts a suitable alternative?
In the event of an accident, repairs to a luxury vehicle should be made with original equipment manufacturers’ parts to ensure optimal performance and design.
- If an auto accident caused by another driver had tragic results, are you clear on how your policy would respond?
Particularly during times of economic hardship, many drivers on the road are un- or underinsured—and may not have enough coverage to compensate for your damages. Without specific coverage to protect against other drivers who lack adequate insurance, you or your family may suffer financially in the unfortunate event of a serious accident.
If you aren’t clear on how your coverage will measure up to circumstances that go beyond the popular marketing messages, check in with a trusted independent insurance advisor.
