Automobile insurance is used to protect you against expenses you may not otherwise be able to afford if you are involved in an automobile accident. The automobile policy is a combination of several individual types of coverage.
LIABILITY COVERAGE (REQUIRED by N.C. LAW)
Your Liability coverage will pay for bodily injury and property damage for which any covered individual becomes legally responsible. The Personal Automobile Policy will cover you or any family member while using any automobile or trailer, and any person using your covered automobile with permission. The policy will pay up to the limits listed in your policy. Under this coverage you will have separate limits of liability per person injured and limits of liability per accident. This is called split limits. For example, you may have limits of 100/300/50.
This would mean that your policy would pay up to a maximum of $100,000 to any one person injured by a covered driver or up to $300,000 for all injured parties combined, as a result of a single accident. Also, this coverage has a single limit of liability for all property damage resulting from any one accident. Using the above example of 100/300/50 limits, you will have a limit of $50,000 Property Damage Liability for each accident.
The liability section can be separated into three parts: Bodily Injury Liability, Property Damage Liability and Supplementary Payments.
Bodily Injury Liability
This coverage will pay for damages to other people as a result of an accident caused by you or another covered driver. Examples of damages include medical and funeral expenses, lost wages, disability, rehabilitation, pain and suffering, law suit settlements and legal expenses.
Property Damage Liability
This coverage will pay for damages to other people’s property as a result of an accident that is caused by you or another covered driver. Examples of damages include the repair or actual cash value (ACV) of another individual’s automobile or other property and legal expenses.
Supplementary Payments
This coverage is in addition to your stated limits of liability. (Review your policy or contact your
agent to identify the limitations and exclusions for this coverage.) This section provides payment on accident related expenses involving:
❊ Bail bonds;
❊ Premiums on appeal bonds and bonds to release attachments;
❊ Costs taxed against an insured and interest accruing after a judgment is entered;
❊ Loss of earnings because of attendance at hearings or trials at the insurance company’s request;
❊ Expenses for emergency first aid to others at an accident involving a covered auto; and Other reasonable expenses incurred at the insurance company’s request.
COVERAGE FOR DAMAGE TO YOUR AUTOMOBILE
This coverage is for direct and accidental loss to your covered automobile, or any non owned automobile that meets the following definition:
❊ Any private passenger automobile or trailer not owned by or furnished or available for the regular use of you or any family member while in the custody of or being operated by you or any family member.
❊ Any auto or trailer you do not own while being used as a temporary substitute for your covered auto because of its breakdown, repair, servicing, loss or destruction.
Collision
Collision means physical damage to your covered vehicle caused by an impact with another vehicle or object. This coverage pays the lesser of the cost of repair or ACV of your automobile.
Other Than Collision (Comprehensive)
This coverage pays the cost of repair or ACV of your automobile less any deductible. Losses caused by the following are considered comprehensive claims:
❊ Missiles or falling objects;
❊ Fire;
❊ Theft or larceny;
❊ Explosion or earthquake;
❊ Windstorm;
❊ Hail, water or flood;
❊ Malicious mischief or vandalism;
❊ Riot or civil commotion;
❊ Contact with a bird or animal; or
❊ Breakage of glass.
MEDICAL PAYMENTS COVERAGE
This coverage pays for reasonable and necessary medical and funeral expenses due to an automobile accident. Individuals covered under this coverage include:
❊ You or any family member while occupying any automobile, or as a pedestrian when struck by a motor vehicle;
❊ Any other person while occupying your covered automobile or any vehicle (private passenger automobile or trailer licensed for road use) driven by you or a family member.
The policy will pay up to the limits listed in your policy for each individual injured. The Medical Payments coverage will not provide coverage for any expenses if the injuries occur while occupying a motorized vehicle with less than four wheels.
UNINSURED/UNDERINSURED MOTORISTS (UM/UIM) COVERAGE
Uninsured Motorists (UM) Coverage
Your Uninsured Motorist coverage will provide protection when an uninsured driver, who is at-fault, injures you or another covered individual. It also provides property damage coverage.
Underinsured Motorists (UIM) Coverage
This coverage will provide protection when an underinsured driver, who is at-fault, causes injury to a covered individual. An underinsured driver is one whose limits of liability are less than your UIM limits, and not enough to cover the losses of the people the underinsured driver injures in an at-fault
accident.
UIM coverage does not provide protection
against property damage. The UIM coverage will pay a maximum of the difference between the other driver’s Liability limits and your UIM limits. Caution: The insurance company will not provide coverage if you or your legal representative settles the bodily injury or property damage without the company’s written consent.
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