Auto FAQs

Q: When purchasing automobile insurance what should I consider?

A: There are several things you should consider when purchasing automobile insurance that your independent agent will help you with. Here are a few:

  • Purchase the amount of liability coverage which makes sense for you.
  • Select the optional coverages you want.
  • Decide which company to purchase insurance from.
  • Don’t base your decision solely on price. Other factors like service and claim response are extremely important in selecting the right insurance.

Q: Does my insurance policy cover a friend if I loan him/her my car?

A: When you loan your car to a friend or an associate, he or she will be covered under your automobile insurance policy.

Q: What is collision physical damage coverage?

A: Collision is the loss you incur when your automobile collides with another vehicle or object like a telephone pole.

Q: What is comprehensive physical damage coverage?

A: Comprehensive provides coverage for non-collision physical damage to include losses such as animal hits, hail, or vandalism.

Q: How can I lower my automobile insurance rates?

A: There are several things you can do to lower the cost of your automobile insurance. One way is to look for competitive pricing. An independent agent works with many companies and can provide you comparative rates and insure that your are getting the same coverage.

Another way to lower the cost is to change your deductible. By raising your deductible you may lower the cost of your automobile insurance almost 10% You must be able to pay the deductible amount in case of a claim. You can also look for discounts that you may be entitled to. Some examples of discounts that may be available are: multiple cars under the same policy, carrying a homeowners policy with the same insurance company, membership to various groups or associations.

Q: Am I covered when I rent a car?

A: There are two coverage concerns to address. One is Bodily Injury/Property Damage Liability. The other is Physical Damage to the rented vehicle itself.

Bodily Injury/Property Damage Liability

If you currently insure a vehicle, your liability limits will extend to another vehicle used as a temporary substitute for your own vehicle. This would be at the same limits as on your automobile insurance policy.

Physical Damage to the rental vehicle
Car rental companies do offer “physical damage waiver” coverage at the time you sign the rental contract. Usually it costs an extra $12-$15 per day. This coverage absolves you of any responsibility for damage to the rented vehicle. Due to various clauses in the rental contracts, it is highly suggested that you take advantage of this coverage. If you currently insure a vehicle and have comprehensive/collision coverage on your own vehicle, you will also have coverage on the rental vehicle. However, there are serious limitations:

  • Most automobile insurance policies do not cover loss of use. If the damaged rental vehicle is out of service being repaired, the rental company can charge you for the lost income. If the vehicle normally rents out for $40 a day, but it is in the shop being repaired for 10 days, they could charge you $400.00 for loss of use. The longer the vehicle is out of service, the more cost you will incur.
  • The bigger issue is one referred to as “diminished value”. If you cause $4,000 of damage to the vehicle, the rental company may choose to repair – or – they may choose to sell off the vehicle at a diminished value. If the vehicle was originally worth $25,000 they may choose to sell it for $15,000 as a damaged vehicle. Your automobile insurance policy may pay for the $4,000 in damages, but that leaves a $6,000 gap which you would be responsible for.

As mentioned, when renting a vehicle, the “physical damage waiver” coverage is an option, and it does cost extra, but it would be our recommendation to purchase this additional coverage for your own peace of mind.