Car insurance is vital to protect your investment and your financial stability in case of an emergency. But while most Americans assume that their auto insurance will cover all their needs after an accident or theft, their insurance may not be as complete as they expect. Standard auto insurance policies have a few gaps that may not be obvious to most drivers.
To help you ensure the right coverage for your particular circumstances, here are a few things that may require additional insurance coverage.
1. Belongings
Many people would be surprised to find out that their auto insurance might pay to fix their car but not to replace their laptop inside the car.
Insurers generally exclude personal belongings from standard car coverage, but homeowners insurance policies may cover your stolen belongings. Insurers define the difference between what each policy covers by what items are permanently installed on the car (such as a GPS system).
If you regularly use expensive personal items in your car — such as a high-end mobile device, computer, or specialty equipment for work — take an inventory and document these items in case you need to prove they were in the car when something happens to them.
2. Business Vehicles
If you use your vehicle both for personal and business purposes, talk with your insurance agent about how to insure it for both uses. You may need an additional commercial vehicle policy to cover use while you conduct your business as well as for business equipment inside the car. A commercial policy would also be good if you ever have partners or employees who use the vehicle on business as well.
3. Classic Cars
Classic and antique cars are a special situation. They are hard to value correctly, they do not depreciate at the same rate as other vehicles, and they are often used in very different ways than daily driving vehicles. Vehicles with historical value cannot be compared to the standard family sedan in your garage.
In addition, kit cars, hot rods, and experimental vehicles may not fit established parameters for regular coverage.
If you have a vintage vehicle, you may want to apply for a special Classic Car or Antique Insurance policy instead. Designed specifically for hard to define collector's vehicles, these coverages allow you to choose the payout value to meet your car's specific needs.
4. Custom Parts
Have you made custom modifications or installed aftermarket parts on your vehicle? Those items may not be fully covered in standard auto insurance, particularly if you have not notified the insurer of the work done.
Start with a call to your insurance agent before you decide on a specialty addition or alteration. You may be able to add a rider or additional policy specifically to cover certain parts — often called a Custom Parts and Equipment policy.
5. Rental Cars
How much your policy covers your financial risk when renting a car depends on your particular insurance carrier and policy. For instance, while you may have coverage if you get into an accident while driving the rental car, the rental company may still charge you for its loss of use of that car while it is being fixed.
Often other fees exist as well, such as loss-of-value and rental car company administration fees, which your policy does not cover. Before renting any vehicle, check with your agent about what exactly is covered and for whom.
Do you have questions about whether or not your current auto insurance properly covers all your assets? Make an appointment today to talk with the insurance experts at Cypress Insurance to learn more.
