The Three Basic Sections of Your Auto Insurance Policy
by Ed Sneineh
Chicago Auto Insurance Quotes Provider
Many people refer to their insurance ID card as their auto insurance policy. Also, some others may mix between the Declaration Pages of the policy and the actual policy it self. In these two situations and many other examples where people may mention certain documents of their insurance contracts, the language they use is erroneous.
Auto Insurance Policy refers to a collection of documentation, guides, and printouts that outline the types of coverages the insured individual has, terms of conditions of the coverage, items not covered- or exclusions, and any extra riders.
Insurance Identification (ID) Card: This is a document that is used as a legal proof of insurance coverage on a particular car. The Insurance ID Card is not the policy. The ID Card is meant to be shown to law enforcement people to prove existing liability coverage on a given auto. The ID card must indicate effective and expiration dates, along with the VIN of the car. You do not have to have all names of drivers listed on the ID card for the ID card to be correct. Also, the ID Card does not have to exhibit if the policy has non-compulsory coverages such as full coverage.
POLICY DECLARATION PAGES: This is a one or 2 page documents that list certain elements such as:
(1) Name and address of insurance company,
(2) The address and name of agent,
(3) Insured's name and address
(4) Effective and expiration dates and time,
(5) Covered autos,
(6) Coverage types, and
(7) Insurance liability limits
Again, your declaration page is not your policy, but is part of it.
Among the most important point in the policy declaration is the type and limits of coverage. In the State of Illinois, there are certain minimum coverages and minimum limits that must be complied with. The following are coverage you might find on an Illinois auto insurance policy:
A- Bodily Injury: This is a mandatory limit in Illinois. This coverage comes with minimum limit of $20,000 per person, $40,000 per accident.
B- Property Damage Liability: Another mandatory coverage in the State of Illinois with minimum limits of $15,000 per vehicle.
C. Uninsured Motorist Bodily Injury: Also mandatory in Illinois and it provides protection for the bodily injury of insured person in the event the insured is stricken by someone who is legally uninsured. The least amounts of coverage in the State of Illinois are $20,000 per person, $40,000 per accident.
Underinsured Motorist Bodily Injury. Optional coverage in the State of Illinois, but must be offered in instances where liability coverage was written at higher than the minimum limits. In this scenario the client may refuse this coverage, but in writing.
Uninsured Motorist Property Damage: Covers the insured auto only in situations where the auto is struck by legally uninsured vehicle. This is not needed if client is purchasing full coverage.
Medical Payments to Others. This coverage delivers for medical and funeral costs of the insured folks in the event they get involved in an auto crash. The coverage amount varies from none to $5,000 with nonstandard auto insurance companies, and is offered up to $25,000 with certain preferred vehicle insurance companies.
Personal Injury Protection: Elective in Illinois but is mandatory in states that follow the no fault liability system. It provides payments for burial and medical costs up to the limit of the policy in any event of auto related accident, regardless of fault (similar to medical payment.)
Comp and Collision: Although optional, this vehicle is needed if you have a loan on the insured vehicle. It gives protection in case of a loss to your auto because of crashes, theft, water damage, fire, etc.
Towing Coverage: Provides for vehicle towing expense in case your vehicle got into a covered loss (maintenance related problems are no covered losses.)
Substitute Transportation: Delivers limited amount of payment (ie $25 per day) for alternative transportation, for a specific number of days(ie 20 days) in the event you suffer a covered loss to your vehicle.
Special Equipment Coverage: Optional in Illinois. It provides coverages for the extra additions that you put in your vehicles (conversions, rims, TVs, etc.)
GAP Insurance: Optional in Illinois. It provides payments for the difference of what the company pays and the amount of outstanding loan on the vehicle (the gap) in the event of total loss.
POLICY TERMS AND CONDITIONS: This section lists the definitions and provisions of your policy, your duties and responsibilities and the duties and responsibility of the insurance company. This is one of the most important parts that you need to read in order to get the best use of your policy.
POLICY EXCLUSIONS: This part will list things and situations where there will be no coverage under your policy. Reading this element very well will help you stay away from lots of heartache when filing a claim in the future.