Every car owner knows how important it is to have car insurance and understand what is covered in it. Exclusions are often outlined in fine print and contain a lot of technical jargon, making it difficult for a layperson to understand.
Whether you’re changing your insurance policy or making a claim, sometimes the language used can make you look for a dictionary. According to Bankrate, knowing what is covered and excluded in your insurance coverage can help you choose the best policy that suits your needs. So read on to better understand damage-based exclusions in a car insurance policy.
What are car insurance exclusions?
As perfect as car insurance may seem, there are always clauses that you need to be aware of. According to Simon and Fletcher PC, exclusions are special provisions in commercial insurance policies that waive coverage for specific events or risks. While insurance policies help mitigate risk, they don’t cover everything. For example, if you get angry and crash into a wall, your insurer will not cover it.
For this reason, it is important to carefully review your insurance policy before purchasing it to understand what it does and does not cover. This can help you buy the right policy. Otherwise, you could end up paying for your insurance for months only to find later that it doesn’t cover what you expected when it’s too late.
Types of damage-based exclusions
Some insurance policies may not cover damage after a car accident, depending on the type of car accident. According to Bankrate, collision insurance rules out vandalism, and comprehensive insurance rules out collisions. The following are the common types of damage-based exclusions:
1. Disaster Exclusion
This clause is also known as force majeure exclusion. Disasters are often not included in most auto insurance policies. While this provision may vary by company and policy, natural disasters such as earthquakes, floods, wars, civil unrest and other unpredictable events of the modern world can be excluded from your auto insurance.
However, most disasters are covered by comprehensive auto insurance policies. If you live in areas prone to natural disasters, talk to your insurer about getting a policy that covers the specific disaster you’re concerned about. Note that any event that could have been foreseen and/or prevented, such as An accidental fire, for example, does not fall under the category of disasters as it could possibly have been avoided by implementing more efficient fire safety measures.
2. Exclusion of intentional acts
This is another provision in liability coverage that excludes coverage for property damage or personal injury where the insured driver knowingly attempted to use his vehicle to cause harm to someone or something. Therefore, if you intentionally run over your nemesis on the sidewalk, don’t expect your insurer to pay for damages. You’ll have to pay for all medical expenses out of pocket, which can be difficult as you’ll likely end up behind bars.
In other cases, an insured driver may intentionally damage their car and contact the insurance company to file a claim to obtain a new vehicle. Such claims will be denied by the insurance company if there is sufficient evidence that the driver knowingly damaged the car.
Full coverage for every car you own is extremely beneficial. In car insurance, however, exclusions are often difficult to understand. Therefore, if you have trouble deciphering the wording of the policy, you should sit down with your insurer to ensure nothing is lost in the translation.
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