Everything You Need to Know About Act of God Car Insurance

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Usually a part of comprehensive car insurance, this coverage protects a car owner in case their car is damaged by an Act of God. An Act of God, also called an act of nature is a term widely used in the car insurance industry to describe any vehicle-damaging event that is beyond human control.

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Usually implying natural disasters, Acts of God have no human component of blame. When the situation is completely unforeseen and therefore, unavoidable, blame cannot be apportioned to any one individual or individuals. In such cases, when there is no one’s liability to draw upon for coverage for all or any damage, motorists need comprehensive insurance to get reimbursed for damages sustained by their car, their passengers and themselves.

Common Acts of God

According to the National Association of Insurance Commissioners & The Center for Insurance Policy and Research, an Act of God is an unpreventable accident or event that is the result of natural causes. So if your car is damaged by a falling tree that was uprooted by a hurricane, you are talking about a classic Act of God.

Similarly, any damages caused by oversized hail, massive snowstorms, whirling tornadoes, tumultuous floods, shattering hurricanes, lava spewing volcanoes, unprecedented tsunamis or raging fires fall under the umbrella of Act of God.

And the damage can be enormous. According to an MSN Money report on the ten most destructive natural disasters since 1980, the numbers are overwhelming. Quoting the National Weather Service and Insurance Information Institute, the article states that the damage was over $501.1 billion, and was caused by hurricanes, droughts, floods, and earthquakes, among others.

Besides natural disasters, other events also fall under the Act of God provision.

For instance, if an animal were to appear in the path of your car and you swerve to avoid it and cause damage, this would also fall under the Act of God category. Insurance companies assume that a driver would usually not have enough time to react to such a situation that could potentially result in a collision and therefore, would not hold him or her liable for it.

While comprehensive car insurance will cover most of the above-mentioned calamities, it is prudent to read your insurance policy carefully and educate yourself about all covered and non-covered Acts of God. Such knowledge will come in handy in case of unexpected damages caused by any natural disaster that impacts your car.

Act of God Coverage: The Differences Within

It is also important to remember that each state and each insurance company defines Act of God coverage differently. The specific definition and terms of coverage of your individual automobile insurance policy will determine allowable claims.

So make sure you talk to your insurance agent or consult your state’s insurance regulator to get a clear definition of Acts of God and the associated coverage required. This will ensure that you have all the coverage you want or give you the option of seeking additional coverage in case of any exclusion.

Interpreting Acts of God

Definitions of Acts of God can vary subtly, depending on the state and insurance company. Additionally, there are some areas of fuzziness when it comes to interpreting the policy terms and placing liability.

For instance, a hurricane is indisputably an Act of God. However, if you choose to drive during a hurricane and flood your car, your insurance company might not cover the damage under the Act of God provision. This is because you chose to drive your car during inclement weather leading to the damage, making it a human act.

Similarly, opening your car door during a nasty windstorm resulting in it being ripped out may leave the driver liable for damages since the decision to open the door is considered human action.

In other words, make sure you understand the various terms and conditions of your insurance policy to avoid unpleasant surprises.

The Cost of Protection against Acts of God

Automobile insurance companies address the issue of possible damage because of Acts of God in their policies. In most cases, if you have comprehensive car insurance, you will be covered against damages caused by reasons beyond human control.

The cost of such coverage will vary depending on the state, the individual policy, as well as the insurance company offering the policy.

Your location can also play into the cost. For instance, the cost of comprehensive auto insurance in California might be higher since insurance companies have to factor in the high incidence of earthquakes into their calculations.

While Acts of God falls under your comprehensive car insurance in most places, you might look into additional coverage to protect yourself if you live in high-risk areas that are prone to certain climactic devastation. For instance, damage by hurricanes might be excluded in Florida, given the high likelihood of such an event.

Since certain insurance companies might have exclusions depending on your geographical location, look into your options. Most of these exclusions can be covered by taking out a rider to the policy.

If you do not have comprehensive coverage, you should be aware that sometimes car insurance companies could use an Act of God reason to deny restitution, even if the other driver is at fault.

For instance, if a driver skids on black ice and hits your car, the other car’s insurance company might claim an Act of God and refuse your claim. In such cases, you might have to take the other driver to court or make a claim against your own insurance company, which will push them to pursue the other insurance company and the at-fault driver.

Understanding Act of God Coverage

Every insurance policy comes with certain exclusions. In the case of Act of God, most of the above-mentioned violent acts of nature are protected by comprehensive car insurance but not by collision or state-mandated liability coverage.

It is also important to know that your premium is not likely to rise if you were to make a claim because of damage caused by an Act of God since they are deemed unavoidable and there is no fault to be apportioned.

However, flash floods and lighting strikes are usually excluded from Act of God coverage in comprehensive plans. This is especially important if you live in a flood or hurricane prone area. Another aspect that might be difficult to be assigned as Act of God is contamination from a biological or chemical agent.

Also, remember that any personal property kept in the car that is damaged or demolished during the claimed event is not covered under the Act of God portion of comprehensive coverage. They might fall under homeowners insurance or renters insurance, if you have them.

The Act of God Coverage: Who Needs It

Comprehensive car insurance is activated when the damage to your car is not caused by a collision. In other words, it covers all forms of damage caused to your automobile, from theft to an errant baseball, as well as, Acts of God. So go to Kelley Blue Book, and determine the cost of your car. This will help you decide if you need to get comprehensive automobile insurance.

However, if you are the proud owner of a spanking new expensive car, it is imperative that you have comprehensive coverage. Similarly, if you owe a lot of money on your car loan, it makes sense to buy comprehensive coverage. In fact, most financial institutions making car loans require comprehensive coverage as a pre-requisite to any loan applications.

Also, if you live in a disaster prone area, it makes perfect sense to get Act of God coverage. A Fox Business article on Act of God coverage, focuses on the deadly tornadoes that destroyed large parts of Joplin, Mo., in May 2011. The article cites statistics from the Missouri Department of Insurance (MDI) that 6,530 personal auto claims totaling $54,310,402 had been settled till November 2011, with millions more still in process.

The total damage from the tornadoes in Missouri was approximately $2.8 billion. Similar devastation can be wreaked by other disasters such as hurricanes and snowstorms, among others. So make your calculations and factor in the potential risks before making your automobile insurance decision.

Act of God coverage is a very good idea if you drive an expensive car, irrespective of its age or its term of ownership. In other words, even if you own the car outright, it makes sense to carry comprehensive insurance on an expensive car.

Getting Act of God Car Insurance

The Internet has made it very easy to get information about different forms of car insurance today. Not only is it easy to do armchair research, you are also likely to get approval within minutes. Just make sure that you thoroughly understand all the terms and conditions stated under your policy.

Additionally, make sure that whatever insurance company you are choosing to get comprehensive automobile coverage from, including provisions for Acts of God, is a legitimate operation.

Whether you have a new car or an expensive one, enter your ZIP code in our FREE search box found here and we will send you a list of well-researched offers from reputable car insurance companies!

 

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