Are you planning on purchasing car insurance in the near future? Are you unsure how to start? The world of car insurance can be complicated, but if you are armed with research, the process can be less daunting. Planning ahead and understanding your options will save stress, in the event of an accident. The purpose of this article is to help you avoid common pitfalls in purchasing insurance, and offer insight into the options available to you.

1. Full Tort v. Limited Tort: What’s the difference?
No, it’s not the dessert. That’s a torte. Tort is all about injury coverage. Limited tort is very appealing to most insurance buyers, because it’s cheap. But, it can cause problems for an injured person when an accident occurs. Limited Tort allows for an injured person to only recover out of pocket medical expenses, wage loss, and car repairs. It does not allow a person to recover non-monetary damages, such as pain and suffering. In essence, by choosing limited tort, the person is waiving the right to recover compensation for long term future effects of injuries. Full Tort, on the other hand, not only allows you to seek compensation for monetary damages, but for the non-monetary damages of pain and suffering, permanent injuries, loss of enjoyment of life, etc. While you may save some money on your monthly premiums by choosing limited tort, you are not saving yourself stress if you are ever involved in a car accident.

2. Stacking
You’ve probably heard this term thrown around in insurance commercials. So, what does it mean? Stacking increases your uninsured (UM) and underinsured (UIM) limits in relation to how many cars are insured. Stacking is only available if you own more than one car. To put it simply, stacking allows you to have higher UM/UIM coverage in the event of an accident caused by an inadequately insured driver, by combining coverage limits of the cars you own. You generally have the option to stack within one policy, where more than one car can be added to the same policy, or to stack across policies, where you can have coverage available to you from more than one policy. Why would it make sense to have this coverage? You will have higher coverage limits in an accident caused by an inadequately insured driver, and without stacking, your UM/UIM coverage can be capped at liability limits, depending on the state.

3. Rental Car
Most insurance policies will have an option that will provide you with an allowance for a rental car, in the event of an accident. Before you decide that you don’t want to spend the extra money on this option, consider your circumstances if you were ever in a car accident. Do you have another car, or some transportation, available to you? If you don’t, this option will help you with payments for a rental car. The allowance for a rental car will prevent you from having to pay full price for a rental car. Don’t ignore this option! It will save money, time, and stress.

4. Discounts
Shop around for discounts. Check with your company or college for discounts. If you are a member of any groups, such as a college honors society, insurance companies offer discounts.

This article by no means explains or exhausts all of the options available to you when choosing an insurance policy. However, it provides you with an overview of topics that you may not have considered, or should research further. Ultimately, whenever you are making decisions about an insurance policy, the best thing you can do is to ask questions if you don’t understand something.

This article is not legal advice. For legal advice, contact Graham & Mauer, P.C. today.