In Florida, car insurance laws are confusing and convoluted. To add to this confusion, different types of car insurance coverage pay for property damage, medical bills, and vehicle repairs—to you or to another driver if you caused a car accident. If you are wondering about the difference between GAP, liability, collision, and comprehensive car insurance, you are not alone.
Liability insurance protects you in a car an accident regardless of who caused it, paying for your injuries and damages. Comprehensive and collision coverage pay for different types of repairs to your vehicle. GAP insurance protects you if you owe more on your vehicle than the amount your insurance will pay out if your car is a total loss.
What Is Liability Car Insurance?
Liability car insurance covers the damages or injuries that result from an accident. In Florida, you must carry a minimum coverage of:
- $10,000 in property damage liability (PDL); and
- $10,000 in personal injury protection(PIP).
PDL insurance pays out for property damage that results from an accident. PIP insurance covers injuries that you and your passengers may sustain in an accident. This type of insurance also covers lost wages if you cannot return to work due to your injuries, as well as funeral costs in the event of a fatality.
Since Florida is a no-fault state, each driver seeks coverage from their own PIP policy after a crash. However, as you might imagine, $10,000 will not go far toward any serious injuries. That is why you have the option of purchasing bodily injury liability (BIL) insurance in addition to your PDL and PIP coverage.
If you have BIL coverage and seriously injure another driver in a crash, this policy will cover their costs. Otherwise, they can sue you for financial compensation.
What Is Comprehensive Car Insurance?
Comprehensive car insurance covers damage to your vehicle that is not related to a vehicle accident. If someone steals your car or if a tree falls on it, you will submit your insurance claim under your comprehensive policy. This coverage also pays for damage from vandals, fire, and falling objects—like coconuts. This coverage also typically pays for auto glass repair and replacement, including a cracked or broken windshield.
Florida law does not require you to carry comprehensive insurance. However, if you have a car loan, the finance company may require you to maintain this coverage until you pay off your loan in full.
You can lower your premiums by purchasing a policy with a higher deductible; but that means you will have to pay more money out-of-pocket when you make a claim.
What Is Collision Car Insurance?
Collision insurance covers the damage to your car after a crash. It will also pay for the damages to your vehicle if you have a single-car accident, such as a rollover, or if you back into a light pole or another immovable object.
Collision insurance is optional in the state of Florida. However, like comprehensive coverage, your car loan company may require it until you pay off your vehicle.
Consider carrying this type of insurance even if you do not have a car loan, especially if your vehicle has a higher value or if you could not afford to replace your car if you total it in an accident.
Like comprehensive coverage, you can lower your premium by having a higher deductible. However, you will have to pay the amount of your deductible out-of-pocket if your car needs repairs your need to replace it.
What Is GAP Car Insurance?
When you drive a new car off the lot, it diminishes instantly in value. However, if you financed your vehicle with a car loan, your loan balance does not diminish accordingly.
If you have a car accident in the first weeks or months of buying a vehicle and the insurance declares your vehicle a total loss, your collision coverage will pay out on the current estimated value of the vehicle—which is typically less than the amount you still owe on your loan. GAP insurance protects you for the difference between what you owe and what your collision policy pays out.
Without this coverage, you could have to continuing making loan payments even after your vehicle is in the junkyard. If you lease your car, the leasing company may require you to carry this coverage. Some auto loan companies also require this coverage.
How Can I Talk to a Lawyer About My Insurance Coverage?
The Florida car accident lawyers of the Law Firm of Anidjar & Levine understand how important the right car insurance coverage can be for your finances. Call us today at 800-747-3733 to learn more about how the right coverage can protect you, your family, and your future.