Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products, including home, life, auto, and commercial, and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, mainly in the insuranc...

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UPDATED: Oct 19, 2021

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Important facts to know...

  • The entire purpose of insurance is to help protect you from financial loss if there’s an unforeseen event
  • Car insurance will pay for covered expenses when you have an accident regardless of fault
  • If you carry physical damage coverage under your own policy, your insurer will pay when your car is damaged
  • Insurance doesn’t pay if you intentionally damage your car, but it may pay for events where damage is accidental
  • When you accidentally damage someone else’s car, your Property Damage Liability will pay for repairs

Accidents happen. No one is perfect. Learn from your mistakes. These are all sayings that you’ll hear throughout your life from your parents, your teachers, and your coaches.

Unfortunately, breaking your favorite toy in childhood is not nearly the same thing as wrecking your favorite car as an adult. If you damage your car in an accident, there’s a possibility that you could cause hundreds of thousands of dollars in damage.

The average person can’t afford to pay to replace their car, let alone someone else’s. If auto insurance were not a requirement, there would be no guarantees that any form of accidental damage sustained in a crash would be covered.

Which is why insurance has become mandatory in all but two states. Let’s discuss what you need to know about coverage for accidental damage.

Concerned about experiencing accidental damage to your car and having sufficient coverage? Compare at least three to four policies today! Enter your ZIP code above to find the best rates for you!

What does auto insurance do for the policyholder?

If you asked for the most straightforward response to the question above, an insurance expert would say that car insurance indemnifies the policyholder. The problem with that simple answer is that many people don’t understand what indemnify means.

You can say insurance is an indemnity contract, but that doesn’t help deepen anyone’s understanding when the legal term is foreign to the average consumer.

When you enter into an indemnity contract, the insurance company is agreeing to compensate others for loss or damage that arises out of the actions of the policyholder.

When you enter into an indemnity contract and you’re the one seeking protection, you’re the indemnitee. The insurance company is the indemnifier, and they are promising to minimize the risk of financial loss for as long as the policyholder fulfills their duties.

The most important job of an auto insurance policyholder is that they pay their auto insurance premiums on time.

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Does auto insurance protect you from all types of loss?

Car insurance isn’t meant to be a warranty. Insurance is specifically intended to protect the policyholder if they sustain a sudden and unexpected loss.

Most people imagine car crashes when they hear these qualifying terms, but auto accidents aren’t the only losses that you’re protected from if you carry the right coverage.

When you build a full coverage policy, your auto insurance will protect you from things like a mistake when cutting down a tree to forgetting to close your windows when there’s a storm in your area. You might even have coverage if you put the wrong gas in your car.

It surprises many to learn just how much protection auto insurance affords. It might protect you after a car accident, a storm, or an act of vandalism, but there are still gaps in coverage.

Car insurance contracts have restrictions when the damage is because of wear and tear. If a system breaks down over time, that’s something that you need a warranty for.

What type of auto insurance is required?

Most state officials have made car insurance compulsory. In the state’s eyes, anyone that owns a car needs to be able to show evidence of financial responsibility.

One way to guarantee that everyone is financially responsible is to have them buy at least a minimal level of insurance protection.

If you’re looking to buy only the auto insurance that’s required by law, you’ll be able to keep your premiums low.

Unfortunately, some bargain shoppers don’t realize that buying nothing more than what’s required by law doesn’t offer them much protection. There’s financial protection, but not protection for your car, truck, or van.

When you select only basic auto insurance, you will have coverage that pays for third-party damages but not your own. That’s because virtually all states require nothing more that third-party liability coverage.

Here’s what liability insurance affords you protection against:

  • Bodily Injury Liability — Pays for medical expenses when you cause an accident and occupants in another vehicle are injured
  • Property Damage Liability — Pays to repair property you don’t own or replace it at fair market value when you’re at fault in an auto accident

If you accidentally hit a car, does insurance pay?

All types of different accidents can happen in or around your vehicle. One of the biggest risks that can rear its ugly head when you’re in your vehicle is getting into an accident with another motorist, cyclist, or pedestrian.

When you make a mistake, you’re considered the liable driver. In most states, the negligent driver can be sued for their negligence.

Since injured parties can file expensive lawsuits and even unfounded ones, it’s crucial you have auto insurance.

Not only does your auto insurance include liability coverage to pay for damages and injuries, but it also includes supplemental payments coverage that will help pay for legal defense, court costs, and related expenses that pop up if you’re sued.

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If the accident is intentional, will your policy pay?

Failing to brake or missing a stop sign are both mistakes, but in no way are they intentional. You could even be intentionally speeding and accidentally hit another vehicle.

The issue arises when you intentionally crash into property or a vehicle and then have to file an accident claim. While that’s something you would never do, it’s important to know how your insurance protects you if you’re ever lending your car out to other people.

Most auto insurance policies have an intentional act exclusion built into the contract.

Since the entire purpose of the contract is to protect the vehicle owner/policyholder from unforeseeable events, it would make sense that a foreseeable or intentional act that causes damage or injury won’t be covered.

There’s a fine line between intentional and unintentional damage.

You might think an insurer would try to deny your third-party liability claim for damage because you intentionally speed through an intersection, but that’s not the only guideline that must be met for the exclusion to take effect.

You must have sped through the intersection when the intention to hit someone for the insurer to have a basis for denying your claim.

Will your insurance pay for your car if it’s damaged in a collision?

A basic policy will pay for third-party damages after an accident, but you need more than just basic coverage if you want your insurance to cover damage to your car after that same crash.

When you’re in a collision, especially a collision where you’re the negligent driver, you must have collision coverage under your own policy.

Collision coverage is the first-party benefit that pays to repair your car after you’re in an accidental collision. The coverage pays up to the Actual Cash Value of the vehicle (minus your collision deductible) for car repairs or total replacement.

If it’s determined that you intentionally damaged your car, the intentional acts exclusion will apply just like under your liability coverage.

If you’re the victim in an accident, do you need collision?

If you’re not liable to pay for damages to the other driver’s property, you’ll be recorded as the victim in the accident.

You can then file a claim against the other driver’s insurance for your repairs.

The other driver’s insurance will pay a reasonable amount to fix your car or replace it if totaled. You don’t have to worry about paying any deductibles.

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What happens if you’re in an accident with an uninsured motorist?

If you were t-boned or rear-ended by a driver, you might not always have the third-party coverage to lean on. When it’s the other driver’s fault and they are uninsured, you still need to have some type of first-party coverage to protect yourself.

Collision will help you, but it’s even better to have uninsured motorist coverage options.

Uninsured Motorist Protection will help pay if you seek medical treatment after an accident with a driver who doesn’t have sufficient insurance. Some states require UM coverage, but most don’t.

In addition to the bodily injury protection, you can add Uninsured Motorist Property Damage. This coverage pays up to $3,500 for repairs to a car that doesn’t have full coverage. It will also pay for your deductible if you do have a collision.

What about accidents that don’t involve a crash?

You don’t have to be driving your car for it to be accidentally damaged. There are instances where your car can be totaled while it’s sitting parked in a driveway. Cutting down a tree could turn into a disaster.

These situations are where your comprehensive coverage comes into play. Comprehensive will pay for unique accidents where there isn’t a collision.

Your accident does cover accidental damage. In fact, that’s all it covers since intended damage is excluded.

Make sure to review what scenarios will be covered under your insurance. If you don’t feel like you have enough protection, get a quote for a more comprehensive plan. Use an online quote tool today, and you can get your quotes quick and easy.

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