What Auto Insurance You Need To Know PDF Manual
Auto Insurance can protect you from the financial costs of an accident or injury, provided you have the proper coverage. Yet many people are unclear about what their insurance policy covers until it is too late. They may have difficulties settling a claim or face rate increases or termination of coverage.
Protection. Insurance is a way of transferring risk for a loss among a certain group of people. You, and others, pay premiums to an insurance company to be reimbursed if you have an accident. The amount you can collect and under what circumstances are outlined in your policy.
Required. Under most circumstances, a licensed vehicle in the state of Minnesota must have liability, personal injury protection, uninsured motorist, and underinsured motorist coverage. These types of coverage are described below. Varied. The State of Minnesota has established minimum policy requirements. Many people, however, choose options that exceed these minimum requirements, thereby increasing the cost of the policy.
A savings account. The premium you pay is not deposited into an “account” for you to withdraw in the event of an accident. If it were, it would probably not be enough to cover the cost of a major claim. Complete. Every policy has limitations on what it covers and to what extent. You may not be fully covered in every situation. Your policy will explain the limitations. Guaranteed. An insurance company may elect to cancel your coverage or not to renew your policy, depending on your driving record or other factors. Minnesota law establishes the standards for these cases. See Cancellation and Nonrenewal of a Policy, page 12.
Who is covered? You are covered by the policy in your name. Any relative living in your home, who does not have a policy of his or her own, is covered by YOUR policy. This includes a spouse, children, or a minor in your custody or the custody of a relative. A driver using your car with your permission, who is not covered by another policy, will be covered by your policy.
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