Automobile Insurance Coverages

Liability Coverage is insurance that will pay for injuries and damages you negligently cause to other people. If you negligently cause a serious or fatal accident you may be liable to the tune of hundreds of thousands of dollars. If your liability exceeds the limits of your insurance coverage your property and assets could be sold to cover the remainder. Therefore, it is important to have adequate liability coverage to protect your property and assets.

Fortunately, in most cases the liability coverage will exceed the amount of the victim’s injuries. When that is the situation, the victim will usually reach a settlement directly with the insurance company within the policy limits.

The minimum liability coverage allowed in North Dakota is $25,000 per person, $50,000 per accident and $25,000 property damage (N.D.C.C. 39-16.1-02). The same minimum coverage is required to drive on Grand Forks Air Force Base. Higher coverage amounts are available for little additional cost. Higher coverage is advisable if you have significant property and assets.

North Dakota, like many states, has "no-fault" insurance laws. (N.D.C.C. 26.1-41-02) This means that your insurance company pays for your injuries and those of your passenger, regardless of which driver was at fault. This policy helps avoid litigation because each insurance company takes care of its own clients. Keep in mind your insurance company is paying for your injuries. Therefore you should have sufficient coverage or any bills that exceed your coverage will be taken from your pocket.

Pursuant to North Dakota Senate Bill 2406, 1999 session, motorists convicted of found driving without liability insurance (1) must provide proof of insurance for three years (2) will have their license suspended and receive a new license with notation "this driver is required to provide proof of insurance," (3) the insurance company covering this motorist must notify the Department of Transportation if the policy is canceled or terminated.

offers protection if you are injured in an accident with a person who does not have insurance or one who does not have sufficient coverage. North Dakota requires uninsured motorist coverage (N.D.C.C. 26.1-40-15.2). This coverage is a good idea since many of the drivers on the nation’s roads today are uninsured. If your state does not have a no-fault law, uninsured and underinsured motorist coverage is an especially good idea.

or med-pay coverage is an additional coverage for anyone hurt while riding in your car. In some cases med-pay will cover your medical bills even if you are injured while riding in someone else’s car. The coverage amounts offered are usually between $1,000 and $5,000. When you are involved in an accident med-pay coverage will offset any immediate medical bills up to the amount of med-pay coverage you purchased.

Generally, the insurance company will be quick to disburse a check for med-pay claims, when properly supported by medical bills and records. In many states, med-pay payments are considered separately from recovery under other forms of insurance for the same injury. In those states the insurance company usually will not seek to deduct the med-pay payments from other insurance proceeds paid to an insured.

covers the loss of income due to injuries suffered in an auto accident. North Dakota and all other "no-fault" states require their drivers to obtain wage loss coverage. Wage loss coverage is unnecessary for military members in view of our military pay.

pays for services you cannot perform for yourself due to injuries suffered in an auto accident. Typically, coverage is capped at $5000.

pays for damage to your vehicle. If you are involved in an accident with another driver and are not at fault, you should seek to recover for the damage to your vehicle from the other driver’s insurance. By doing so you will help hold down your insurance premiums. Those who have had to file a collision claim with their own insurance company know that a higher insurance bill often follows.

If your car is totaled in an accident, collision coverage will pay the retail value of your vehicle immediately before the accident. Most collision policies have a deductible that must be paid by the insured before the insurance company begins to pay for repairs. If you are trying to lower the amount of your insurance bill consider accepting a higher deductible. The higher your deductible the lower your premiums will be. Finally, if your car is very old or has little resale value you may wish to consider skipping collision coverage. For example, it just wouldn’t make economic sense to maintain a collision policy and pay a $100 deductible on a car worth $400.

will handle most of the other kinds of damage that may strike your car. The cost for this sort of coverage is affected by location, type of car, and the amount of your deductible. Again, if you have an old junker you may be able to do without this sort of coverage.

are determined by the insurance companies. They can include age, sex, marital status, car type and place of residence. Your driving record and insurance claims history will also be considered. A history of accidents or claims will raise your premiums. Too many claims can leave you classified as an "assigned risk" and with even stiffer premiums. If you are unfairly classified as an "assigned risk" you can turn to the state insurance commissioner for assistance.

1. Take the highest comprehensive and collision deductible with which you are comfortable. Consider dropping both of these coverages on older cars with low resale values.

2. Try to purchase a car with a low "risk factor." Insurance companies assign numerical indices to cars indicating the risks for that car. The lower the "risk factor" the lower your insurance rate.

3. Shop around for discounts. Many insurance companies offer discounted rates based on accident-free driving histories, traffic-citation free driving histories, driver’s education, good grades, anti-theft devices, and professional occupations.

4. Consider eliminating redundant coverages. If your automobile and medical insurance offer the same benefit you may be able to eliminate a portion of one of those coverages.

5. Compare rates. Be sure to consider the type of coverage as well as the dollar amount in any given policy to determine the best value.

You should consider several factors when deciding whether to file a claim. What is the amount of damage to your vehicle? Any minor accident with damage less than the deductible is best handled by you. How many claims have you filed in the past? Insurance companies will raise your rates based on the number of claims you file. Was the accident your fault? Most insurance companies will raise your rates if you file a damage claim for an accident that was your fault.