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Plain Talk Series: A Basic Explanation of Your Auto Insurance Policy – Property Damage

By Evan L. Kaine

The “declaration page” of your insurance policy lists the different types of insurance coverages available under your particular insurance policy. In other words, the declaration page is a basic summary of the insurance coverages that you pay for as part of your insurance premium.  An explanation (in plain English) of the different types of property damage related insurance coverages is below:

Collision Insurance Coverage: This coverage is optional in Georgia.  Collision insurance pays for the damage done to your vehicle resulting from an auto accident regardless of who is at fault for the collision.  This is important because if you are legally responsible for causing an accident, collision insurance is the only type of insurance coverage that will pay for your vehicle to be repaired.

Collision insurance can also be helpful if the insurance company for the person who is legally responsible for causing the accident delays in repairing your vehicle.  You can get your own insurance company to pay to have your vehicle fixed under your own collision insurance coverage.  After paying for your vehicle to be fixed, your own insurance company will file to be paid back from the other person’s insurance company.  If they are successful, you will also be reimbursed for your deductible (see the section labeled “insurance deductibles” below).  This process is called “subrogation.”

Comprehensive Insurance Coverage: This coverage is optional in Georgia.  Comprehensive insurance pays for the damage done to your vehicle resulting from any incident that is not an auto accident.  This is different from collision insurance coverage (explained above) as comprehensive insurance coverage protects you for damages related to theft, fire, vandalism, flooding, hail, etc.

The best example specific to Atlanta would be if your car is parked and a tree falls on top of it.  Comprehensive insurance coverage would pay for this type of damage.

Rental Car Insurance Coverage: Depending upon your auto insurance company and policy language, you may or may not be protected or insured when renting a car.  It is best to first verify whether rental cars are insured under your auto insurance policy before renting the car.  In the alternative, you can purchase rental car insurance from the car rental company and some credit cards offer rental car insurance coverage if you pay for the rental car using that credit card.

Insurance Deductibles:  Most Georgia insurance policies include deductibles for both collision insurance and comprehensive insurance claims.  A deductible is the amount that the insured is responsible for paying before the insurance company pays.  For example, if your deductible is $500.00 and you make a claim under your collision insurance for $1,500.00 in damages, you are responsible to pay the first $500.00 and your insurance company will pay the remaining $1,000.00.

Additional information is available through the Georgia Office of Insurance and Safety Fire Commissioner (http://www.oci.ga.gov/ConsumerService/AutoInsurance.aspx).

You have rights.  Know them and protect them.

For more information about this article, contact Kaine Law.

Published March 07, 2014

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