AUTO INSURANCE PF-AA (Page 1 of 4)
FIN 1050
The Utah legislature has mandated an insurance package for us as a line of defense. It requires Utah no-fault, liability, and uninsured motorist coverage.
I. Utah No-Fault Applies only to bodily injury, etc.; it does not repair the car.
1. Always pays first; you collect from your own company.
2. Each company pays its own claims up to a certain amount (can negotiate between companies behind the scenes or even sue if necessary, but insured is usually not involved.)
3. Insurance always follows the car. (Basic premise; some exceptions)
4. Nothing to do with who is at fault.
5. Is first party coverage means you (driver) are covered.
6. Payments are immediate.
7. Minimum required by law in Utah, $3,000 (per person); minimum you should have: $10,000.
Additional cost is usually about $34.00 per six months.
8. Actually a package of coverage including medical, death benefit, survivor benefit, services for household, lost wages, etc.
9. Covers guest riders
NOTE: Still fault system in place for damage to vehicle and property.
II. Liability (If you are at fault) Does not cover your injury or your property damage.
1. Covers other people in your car and those in other vehicles.
2. Payments here are not immediate, and can require lengthy negotiations.
3. Bodily Injury
A. Minimum required by law: $25,000 per person; $50,000 per accident.
B. Minimum you should have: $50,000 per person; $100,000 per accident (If you are a student).
C. Minimum you should have: $100,000 per person; $300,000 per accident (If you own a home and have other assets).
AUTO INSURANCE PF-AA (Page 2 of 4)
4. Property Damage
A. Minimum required by law: $15,000
B. Minimum you should have: $50,000 (If you are a student).
C. Minimum you should have: $100,000 (If you own a home and have other assets).
D. Your liability will repair other vehicles and property damage if you are at fault.
NOTE: If you are married or 25 or older and you have a good driving record, the added cost to bring your liability to proper levels is approximately $30.00 to $36.00 per six months.
III. Uninsured and Underinsured Motorist (Bodily injury only; does not repair your car).
1. Other party at fault, we are injured.
2. Other party has no insurance or is underinsured.
3. First party coverage (covers you)
4. Additional back-up for medical expenses because exceeding limits of Utah No-Fault.
5. Payments are not immediate, almost like suing (lengthy process).
6. You (or your agent) must prove fault and that they had no or low insurance.
7. Obviously not applicable to a single car accident.
8. Minimum required by law: $10,000 per person; $20,000 per accident.
9. Minimum you should have: $50,000 per person; $100,000 per accident (If you are a student).
10. Minimum you should have: $100,000 per person; $300,000 per accident (If you own a home and have other assets).
NOTE: Added cost, approximately $16.00 per six months, to bring to proper levels.
IV. Maybe your group health and accident insurance at work
1. A few group health and accident plans may provide some back-up coverage for excess medical expenses caused by an auto accident, but don’t count on it. At best, coverage would be limited to yourself and other family members specifically named in your policy. No guest riders are covered.
AUTO INSURANCE PF-AA (Page 3 of 4)
Summary: Usual order of medical payment responsibility:
* Your Fault * Not Your Fault
1. Your Utah no-fault 1. Your Utah no-fault
2. Your liability (does not cover you) 2. Their liability (if insured)
3. Maybe, your group health and 3. Your uninsured motorist (if they are not
accident insurance at work. insured)
4. Maybe, your group health and
accident insurance at work.
V. What insurance covers and pays to repair your car? (Three main types)
1. Collision (Required by lenders)
A. One car must be moving.
B. You have little or no input as to coverage amount
C. Agent will ask you the make, model, options, year of car, etc.
D. Insurance company agrees to repair or replace the car depending on its value at time of accident
E. Cost comes down as car gets older
F. Some people choose not to carry after car is paid for and the value drops to a fairly low amount
G. Most cost effective deductible is usually $500.00
2. Uninsured Motorist Physical Damage Coverage (This type coverage available since October 1990)
A. For all vehicles without regular collision coverage
B. The insurance company must offer this coverage
C. It provides $3,500 maximum protection to your vehicle damaged by an uninsured motorist if:
1) Actual physical contact
2) Owner of other vehicle identified by license plate number
AUTO INSURANCE PF-AA (Page 4 of 4)
3) Reported within 10 days to your insurance company
D. Deductible is $250
E. Cost: $18.00 to $22.00 per six months per vehicle
F. Recommended for all who do not carry collision and where value of vehicle is over $500.
3. Comprehensive (Required by lenders)
A. Covers fire, vandalism, glass, hail, etc.
B. Also covers theft of car, wheel covers, etc., but not personal property in the car (camera, luggage, clothing, etc.)
C. Special rider required for fancy stereos/CD players and cellular phones, etc., that are not part of the original factory equipment.
D. Most cost effective deductible is usually $500.
E. Glass only deductible, $100.00 (Many companies now offer this).
VI. Other Coverage Available
1. Rental Reimbursement (while your car is being repaired)
A. Premium: $10.00 to $12.00 per six months per vehicle
B. Coverage: $25.00 to $35.00 per day up to 30 days
NOTE: If it is the other driver’s fault and they have insurance, their insurance company should provide you with a rental car.
2. Towing
A. Premium: $10.00 per six months per vehicle
B. Coverage: $35.00 and up
C. Road Side Service (Good to have)
3. Accidental Death, Life Insurance
A. Generally too expensive
B. Better to cover under your own life insurance program
NOTE: All amounts listed will depend upon your age, sex, marital status, and driving record, etc.
AUTOINS:FL06 4 AMA