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Are you covered for car crash injuries?

By HELEN HUNTLEY, Personal Finance Editor
Published September 23, 2007


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That's the question raised by the pending demise of PIP, or Personal Injury Protection, which every Florida driver is now required to have. Right now PIP pays up to $10,000 for injuries. Insurance policies written after Oct. 1 will not include PIP, although the Legislature could decide to revive it. ¶ You will continue to have PIP coverage until your next policy renewal, although some companies will allow you to cancel it after Oct. 1. The question: What will take its place? ¶ Here is a look at the other types of insurance that pay for treatment after a car crash. Even if PIP is renewed, you should consider them because $10,000 won't buy much care for a serious injury.

What you should know about auto coverage


Medical Payments Coverage *

Who can collect: You and the passengers in your car. In addition, you and your family members are covered when riding in other people's cars or when hit by a car while walking or biking.

Fault: Pays regardless of fault.

Who needs it: People who have no health insurance or inadequate health insurance. May be desirable for those with a high-deductible health insurance policy. May be beneficial for car pool drivers and others who transport nonfamily members.

Amounts: Typical coverage is $2,000 to $5,000, but some companies offer more.

Bodily injury coverage *

Who can collect: Anyone injured in an accident you caused, except you and your family members who are part of your household.

Fault: Pays if you are at fault or if someone driving your car with your permission is at fault.

Who needs it: Every car owner.

Amounts: $20,000 (per accident) up to $500,000 or more. The more assets you have (investments, bank accounts, rental properties), the more coverage you need because you have more to lose if somebody sues you.

YOUR HEALTH INSURANCE POLICY

Who can collect: You and your dependents who are namedin your policy. However, in rare instances, a policy may exclude coverage for injuries from car accidents. Check your policy to verify coverage.

Fault: Regardless of fault, your health insurance typically will be secondary to medical payments or other car insurance. If the other driver is at fault, you or your health insurance company will try to recover from the other driver's bodily injury policy. Your insurance will pay when you reach the limits of other coverage.

Who needs it: Everyone.

UNINSURED/UNDERINSURED MOTORIST COVERAGE *

Who can collect: You and the passengers in your car. Also covers you and your family members when you are in someone else's car.

Fault: Pays if the other driver is at fault but has no insurance or inadequate bodily injury coverage.

Who needs it: People who have no health insurance or inadequate health insurance. People who transport nonfamily members. People who want extra protection in case of severe injuries; the policy payout may include a settlement for future medical expenses.

Amounts: Same as bodily injury. However, the better your health insurance and the more assets you have, the less coverage you need.

YOUR PERSONAL LIABILITY UMBRELLA POLICY

Who can collect: Anyone injured in an accident you caused except you and family members who live in your household.

Fault: Pays only if you are at fault and after damages exceed the limits of your bodily injury coverage.

Who needs it: People concerned about injury lawsuits who have assets to protect.

Amounts: $1-million is common, but increasingly people are opting for $3-million or $5-million or more. The more assets you have, the more coverage you need.

* Typically included as part of auto insurance policies

[Last modified September 21, 2007, 20:10:22]


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