Common Exclusions that Your Auto Insurance Policy Will Not Cover
Don’t make the mistake of assuming your auto insurance covers anything that may happen to your car on the road. Each policy has exclusions. They are dependent on your state laws and the individual company’s requirements.
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In general, you can expect the following exclusions in most policies.
Don’t assume that just because someone lives with you that they can drive your car. If someone lives with you, they must be listed on the auto insurance policy. If they aren’t and they are involved in a car accident, you might find yourself without compensation for the incident.
This doesn’t include occasional drivers that don’t live with you, though. That’s a different type of risk. As long as the driver has your approval to drive the car, coverage may be provided. A household member though, must be listed because they may be a more recurrent driver, which may create a different level of risk for the insurance company. You must tell your agent about any ‘regular drivers’ of your car so he can provide you with a proper premium for the insurance.
If your vehicle is victim to theft or vandalism, your auto insurance will likely cover the damages if you have comprehensive coverage. What you might not realize, though, is that the insurance only covers the vehicle. It doesn’t cover any personal belongings you had in the car.
Let’s say for example that your car was stolen. It has not been recovered and your purse and cell phone were in the car. Your auto insurance probably won’t cover the cost of the loss of your purse and phone. You may have other insurance, such as homeowner’s or renter’s insurance, that will cover your personal belongings, but you should inquire about it to make sure.
Using the Car for Business Purposes
If you have personal auto insurance, but use your car for business purposes, such as transporting products, you may void your coverage. If you use your car for any type of business purposes, make sure you discuss it with your insurance agent.
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Not all commercial purposes are excluded from your policy, but you won’t know until you ask your agent. For example, do you deliver pizzas, drive an Uber, or teach driver’s Ed? You’ll need to run all of these instances past the insurance agent to see which they consider ‘business purposes’ and require a different type of policy.
Using the Car Improperly
If the insurance company can prove that you were using the car improperly, they can void your car insurance. A good example is carting around more people than the car comfortably fits. A good rule to follow is only drive as many people as there are seatbelts in the car. If there are four seatbelts, don’t transport more than four people.
You may also lose coverage if you are involved in an accident while racing or are involved in an accident while driving under the influence. Your car insurance company assumes you are using your car responsibly and that is usually the only circumstances that they will provide coverage. You can read the exact circumstances, which an insurance company wouldn’t cover you in your insurance documents.
Improper Car Care
Finally, the insurance company assumes your car is properly maintained. This includes performing regular maintenance as well as avoiding excessive modifications. In fact, before you make any modifications to your vehicle, you should check with your insurance company. The type of medications and the way it affects your car’s performance will help the insurance company decide if they will cover the changes or not.
If you are ever unsure about what your auto policy covers, contact your insurance agent. You should never assume that something would be covered. It’s better to be safe than sorry. In other words, be proactive about finding out about your coverage. If you know something isn’t covered, hopefully, you’ll take the precautions to prevent the occurrence or make sure you have other valid coverage for any instances.
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