When most people select their auto insurance policies, they either go online and choose one or call an agent who offers them some recommendations. A few days later, they get the actual policy mailed to them and promptly tuck it away in the car with the registration. Few actually read — or fully understand — the terms.
Why it’s important to read your policy
Yes, it’s a dry read chock full of confusing legal terms, but it’s those very terms that detail the specifications and limitations of your coverage. All of that becomes very important once you have to make a claim.
Auto insurance policies are legally-binding contracts defining what both you and your insurance company must do to remain compliant with its terms for a set period and price.
Pay attention to the declaration page
Consider the declaration page, or “dec page” as it is often called, to be the “Cliff’s Notes” version of your auto insurance policy. It sums up your coverage and provisions from which you chose to opt out. The dec page will list your deductibles, covered and excluded (if any) drivers, coverage limits and the amount that you pay, and in what increments, along with the dates the coverage is in effect.
Declaration pages also include all of the vehicles covered under the policy and their VIN numbers. The insured individual’s address will be listed, too.
Understanding coverage limitations
This is a stumbling block for many claimants. Drivers frequently believe they have more coverage than actually is provided under their insurance policies. The coverage limitations of your policy may be insufficient to cover damages after an accident occurs. When this happens, if you were held liable for the accident, you may be left holding the bag.
It can also affect you if you were insured and the other driver was at fault but didn’t have auto insurance in effect when the wreck happened. Sometimes drivers carry only the most basic liability insurance. In many cases where the injuries are significant, their coverage is insufficient to make a dent in the mound of medical bills and other costs.
Uninsured motorist is a good choice
Even if you decide only to carry liability insurance, it’s a wise choice to also include uninsured motorist coverage. That way, if the other driver is un- or under-insured, your own insurance policy covers the cost of your injuries and damages.
In some cases, claimants have been forced to sue their own insurance companies when they balk at paying out a claim. They may try to find a clause that exempts them from honoring the terms of the contract.
This can be very frustrating to the claimant, who has done nothing wrong. He or she paid for the policy in good faith, drove responsibly and through no fault of the claimant’s, got hit by an at-fault driver. Now the insurance company is dragging its feet or outright refusing to pay the claim. It’s encouraging to understand that if you find yourself in that untenable position, you can always seek justice through the Mississippi civil courts.