What’s in a MN auto policy?

  • Liability Limits

    This part of your policy shows the limits that your company will pay on your behalf if you’re liable for damages or if someone hits you with inadequate limits.  They are broken down into Bodily Injury (BI), which are damages to others that you are legally liable to pay, Property Damage (PD), which are damages to the property of others that you are legally liable to pay, and Uninsured / Underinsured Motorist (UI/UM), which are damages that YOU suffer that aren’t covered by the limits of the at-fault driver.  These UI/UM limits also extend to you while you’re a pedestrian or a cyclist.

  • Personal Injury Protection

    This part of your policy is mandated by Minnesota as part of the “No-Fault” state law.  It simply means that regardless of fault in an accident, each insured’s company will pay up to this PIP limit in medical expenses for their own insureds, often $20,000.  It functions essentially as a medical expense deductible in an effort to limit litigation efforts in fender benders and minor to moderately severe accidents.

  • Comprehensive / Collision

    Comprehensive and Collision coverage pays for damage to your vehicle in the event of a covered loss, often subject to a deductible that you the insured may choose.  This coverage is most often on an actual cash value (ACV) basis.

  • Convenience Coverages

    This is where you’ll see certain convenience coverages like towing and roadside assistance, rental car reimbursement or any other policy endorsements.  These are pretty self-explanatory.

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Regain Control – Uninsured/Underinsured Motorist Coverage

The Insurance Research Council estimates that approximately one out of every eight drivers  in the United States is uninsured. The odds aren’t in your favor when you think about how many people you pass on the highway during your morning commute. However, with the appropriate coverage, there are ways to prevent your run in with an uninsured/underinsured driver from being a costly experience.

How does it work?

Uninsured/underinsured motorist coverage will help protect you if you are in an accident in which the other driver is at fault. If they are uninsured or don’t have enough auto insurance, this coverage will help you pay the bills for the damage they’ve caused.

If the person at fault in underinsured, their insurance company will usually pay for the damages they’ve caused up to the person’s liability limits, and then your provider will cover you for the remaining expenses up to the liability limits of your policy.

If you do file an uninsured/underinsured motorist claim, your insurance company will pursue the third party that caused the insurance loss to the person that is insured. Ideally, this would be the end of it; but recovering may not be possible, as many people who don’t have the proper insurance coverage also don’t have collectible assets. This is why it’s important to have uninsured/underinsured motorist coverage.

Additionally, when you file an uninsured/underinsured motorist claim, you become a third party to your insurance company. This means that you will get be reimbursed as if you were filing in opposition to your provider.

What’s covered?

Uninsured motorist coverage will most likely cover you and your passengers for medical expenses, pain and suffering and lost wages that occur as the result of the auto accident. This coverage also extends to victims of hit-and-runs and can also help cover personal property that was damaged in the accident (such as your vehicle, house or fence).

What are my options?

Much like your personal auto coverage, there are usually two types of uninsured/underinsured motorist coverage that are offered: underinsured motorist bodily injury coverage and underinsured motorist property damage coverage. Bodily injury coverage tends to be more common and some states, including Minnesota, require it as part of the overall auto policy. Property damage coverage is not offered everywhere, but when it is, it’s a good idea to get.

When deciding on your bodily injury coverage, you will need to pick what limits you would like: split limits or combined single limits. For split limits, your coverage will differ based on how many people are injured. A combined single limit is a single amount that your insurance company will pay for all bodily injury as a result of the accident.

It’s wise to have uninsured/underinsured motorist coverage limits that are higher than your at-fault driver’s bodily injury liability coverage limits. Otherwise, you many not receive the benefits you’re seeking. When deciding on the limit that is best for you, look at how much your car is worth, what kind of medical insurance you have, and if you have access to short and long term disability at work.

In Minnesota, the minimum limits are 25,000 dollars per person and 50,000 dollars per accident. Just like with your own liability limits, increasing your uninsured/underinsured motorist limits beyond the minimums is a good way to make sure that you are protected.

Regain control.

You never know when you could be involved with an uninsured/underinsured driver. It’s unfortunate, but many people aren’t adequately insured and this can create circumstances that are out of your control. Uninsured/underinsured motorist coverage can help you regain some of that control.