If you own a car, you buy car insurance coverage.  In the process, you have to make lots of decisions.  Do you want to buy ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More? CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More? What limit for Bodily Injury?  For Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More? For Uninsured Motorist? What deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More? As with other insurance products, auto insurance is full of its own unique terminology.  In this post, I’ll explain all these terms and provide some insights on how to make some of the decisions that determine your car insurance coverage.

As I told my kids (see Advice I Gave My Kids post), I recommend that you read every contract before you sign it.  Auto insurance policies don’t change all that much from year to year. If you use the same insurer and live in the same state, you can probably read the policy every few years to refresh your memory.  In the meantime, this post will help you understanding the basics.

Before going into the coverages, though, I need to provide some background about liabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More and different types of laws governing the liabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More for car accidents.

No-FaultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More vs. Tort Jurisdictions

When you cause an accident in which someone else is hurt or their property is damaged, you have created a liabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More for yourself to reimburse them for their economic loss.  That is, you are liable for paying their medical costs and lost wages, among other things, and repairing or replacing their property. In some 12 states (see the chart at the end of this article for a list) and most or all of Canada, though, the laws make the driver of each car involved responsible for their own and their passengers’ costs in certain accidents.

In the 1970s, car insurance costs escalated very rapidly.  No-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More coverage was introduced in some jurisdictions to slow auto insurance inflation.  In theory, under a no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More system, every driver is responsible for the costs of themselves and their passengers regardless of who was at fault for the accident.  In practice, no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More is applied to only “small” accidents. The definition of “small” varies widely across jurisdictions, with some defining it based on the total cost of injuries and damage and others based on the nature of the injury.  Jurisdictions that don’t have a no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More system are often called tort jurisdictions.

Tort LiabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More

In a tort jurisdiction, you are required to buy Bodily Injury liabilityInsurance coverage that pays costs related to bodily injury or death for which you become legally responsible.   More coverage.  In these jurisdictions, this coverage protects you against the cost of all injuries to others.  You will also be offered Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More coverage which reimburses you for your and your passengers’ medical costs in accidents you cause.

No-FaultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More

Under a no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More system, you are also required to buy Bodily Injury liabilityInsurance coverage that pays costs related to bodily injury or death for which you become legally responsible.   More coverage to protect yourself against the cost of injuries to others, but only for accidents that aren’t “small.”  In addition, you will be offered Personal Injury ProtectionInsurance coverage that pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault.   More which covers injuries to you and your passengers in accidents you cause and in all “small” accidents caused by others.

Coverage Overview

The table below shows which of your coverages will protect you against costs from the people injured and property damaged or destroyed in an accident you cause.  I’ll describe these insurance coverages in a bit more detail below.

Your insurance coverage is available to you regardless of whether you are driving your car or someone else’s car, including rental cars.  If you purchase CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More coverage, it will be cover the full amount of damage for any other vehicle you drive even if the other vehicle is worth more than any of your cars.

Your coverage is also available to anyone else who is driving your car with your permission.  That is, unless someone steals your car, all of the coverages that you buy are available to another driver.  Loss or damage to your car due to theft is covered under ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More.

Bodily Injury LiabilityInsurance coverage that pays costs related to bodily injury or death for which you become legally responsible.   More (BI)

Bodily Injury liabilityInsurance coverage that pays costs related to bodily injury or death for which you become legally responsible.   More coverage pays costs related to injury or death for which you become legally responsible because of a car accident.  Interestingly, passengers are not insured under Bodily Injury liabilityInsurance coverage that pays costs related to bodily injury or death for which you become legally responsible.   More coverage but rather are covered under your Personal Injury ProtectionInsurance coverage that pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault.   More, Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More or Uninsured Motorist coverage.  In no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More states, the insurer pays only when the accident is severe enough to not be considered small.

Property Damage LiabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More

Property damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More coverage pays the cost of damage to other people’s cars and property for which you become legally liable.  Most of the time, the damage is to other people’s cars and their contents. I know one person, though, who fell asleep while driving in a rural area.  She crossed the median, the lanes in the other direction and ran into the front of a store. Fortunately, no one was injured, but the store and its contents were damaged.  In this accident, her car insurer repaired the store and replaced its contents under her Property Damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More coverage.

LiabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More Limits

You will have the option to select the limit of liabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More for your Bodily Injury and Property Damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More coverages.  Coverage can be offered with split limits or a combined single limit (CSL).

Split Limits

When there are split limits, you will see three numbers, e.g., $100K/$300K/$50K.  The first number ($100,000 in the example) refers to the amount the insurer will pay for each injured person. The second number ($300,000 in this example) is the total amount the insurer will pay for Bodily Injury coverage for each accident.  The third number ($50,000) is the total amount it will pay per accident for Property Damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More. When there is a combined single limit, the limit will be described using a single number. That number is the maximum amount the insurer will pay for each accident for all injuries and Property Damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More combined.

Combined Single Limit

I usually buy a combined single limit, but recommend looking at different options to compare the pricing.  For example, if you can find $100K/$300K/$50K coverage for significantly less than a $300,000 combined single limit, you might want to buy the split limits.  I buy the combined single limit because there is more coverage if a single person is severely injured. For example, if only one person is injured in an accident I cause but that person has $250,000 of medical costs and lost wages, a $100K/$300K/$50K limit would cover only $100,000 of the $250,000.  A $300,000 combined single limit policy would cover all of it. Another reason I buy a combined single limit is that I buy an umbrella policy (which I’ll cover in a future post). My umbrella policy requires a combined single limit on my underlying auto policy.

What Limit

I always buy as much limit as I can afford (and, as I indicated above, started buying umbrella insurance when I could afford it).  If you injure someone severely in an accident, you are liable for the full amount of their medical costs and lost wages regardless of whether they are covered by insurance.  If someone has $250,000 of medical expenses and lost wages and the applicable limit on your policy is $100,000, they can demand that you pay the remaining $150,000 from your personal assetsThe value of things the company owns and amounts it is owed More.

Personal Injury ProtectionInsurance coverage that pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault.   More (PIP)

Personal Injury ProtectionInsurance coverage that pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault.   More coverage (PIP) pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault, in a no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More jurisdiction.  You can be reimbursed for medical expenses, loss of income and funeral expenses.

When I lived in a no-faultA form of insurance law under which the driver’s insurance is responsible for medical costs and lost wages for the driver and his or her passengers, regardless of who is at fault. More state, I bought a much lower limit for Personal Injury ProtectionInsurance coverage that pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault.   More than for Bodily Injury liabilityInsurance coverage that pays costs related to bodily injury or death for which you become legally responsible.   More.  Most importantly, my family and I have always had health insurance and I had disability coverage. If you are severely injured in a car accident, your auto insurer pays first.  My health and disability insurance also provided coverage after my auto insurance coverage was exhausted. I suggest confirming with your human resources contact or health and disability insurers that you would be covered if injured in a car accident before making the same choice I did.  If not, you might want to consider buying as high a limit as you can afford.

Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More

Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More coverage reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states, you and your family members are also covered.

I probably don’t buy a high enough Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More limit.  Until I wrote this post, I always focused primarily on my situation and selected my limit in the same way I did my Personal Injury ProtectionInsurance coverage that pays benefits to you and members of your immediate family when involved in an auto accident, regardless of who is at fault.   More limit.  Now that I’ve thought about it more, I realize that I should also be considering my passengers and any pedestrians I might injure. They might not have as much health and disability insurance as I do, so I wouldn’t have a back-up if my Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More limit was less than the cost of their medical care and lost wages.  If you have a lot of non-family-member passengers and especially if you drive other people’s children to school or activities, you might want to consider buying as much Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More limit as you can afford.

Uninsured and Underinsured Motorist (UM/UIM) Coverage

If you, your family members or your passengers are injured in an accident caused by someone else, that person is liable for your medical costs and lost wages.  Unfortunately, there are many accidents in which the other driver’s Bodily Injury limit is less than your medical costs and lost wages or sometimes the other driver has no insurance at all (which is illegal in all US states and Canadian provinces, but still happens).  In those situations, your insurer will reimburse you for any costs you can’t recover from the other driver or its insurance under your Uninsured and Underinsured Motorist (UM/UIM) coverage. The maximum amount you can receive from your insurer is your UM/UIM limit.  Your insurer then has the right to try to recover any amounts it pays to you from the other driver directly.

The selection of a UM/UIM limit is very similar to that of a Medical PaymentsInsurance coverage that reimburses medical expenses in an accident.  In all states, coverage is provided for passengers who are not family members and pedestrians.  In tort states (those that don’... More limit in that you are buying protection for not only you and your family members, but also your passengers.

Physical Damage Coverages

Damage to your car from accidents you cause can be insured under CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More and ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More coverages.

Collision and Comprehensive

CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More reimburses you for damage to your car when it impacts another vehicle or object or rolls over.  ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More reimburses you for damage to or loss of your car from perils than a collisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More. Perils explicitly covered by ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More are:

• Missiles or falling objects
• Fire
• Theft
• Explosion or earthquake
• Windstorm
• Hail, water or flood
• Malicious mischief or vandalism
• Riot or civil commotion
• Contact with bird or animal
• Breakage of glass (also covered under CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More if from an accident)

In addition, many policies will also reimburse you for a temporary replacement for your vehicle until it is repaired.  My policy provides only $20 a day up to a maximum of $600, so the coverage would help cover the cost of renting a car but is not likely to be enough.

A quick tip – Property Damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More coverage is easily confused with physical damage coverageAn insurance coverage that protects you when you cause damage to your own property, such as in a car accident, or without human cause, such as fire, hail, storm or earthquake. More.  Property damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More covers other people’s cars.  Physical damage coverageAn insurance coverage that protects you when you cause damage to your own property, such as in a car accident, or without human cause, such as fire, hail, storm or earthquake. More includes CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More and ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More so protects your car.  I don’t recall all the details, but have an example to illustrate the difference.  One of my daughter’s friends was driving back to college late at night after Thanksgiving on an interstate.  She hit a deer and totaled her car. She had not purchased ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More, so was afraid she was going to have to figure out how to replace her car on a very limited budgetA plan showing targets for income and expenses over a fixed time period, such as a month or a year. More.  It turns out the deer had a hunter’s tag on it and had fallen off the roof of the hunter’s car. Because the hunter was responsible for the deer being in the road, she was fully reimbursed for the value of her car under his Property Damage liabilityInsurance coverage that pays the cost of damage to other people’s property for which you become legally liable.   More coverage.

Physical Damage – What to Buy

CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More and ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More coverages can be quite expensive.  On one of my recent policies, my ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More coverage cost more than my liabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More coverages, while my CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More coverage cost is 2/3 of the cost of my liabilityWhen used as a noun, the amount you owe to someone else.  When used as an adjective, an insurance coverage that protects you when you cause damage or injury to someone else or their property. More coverages.  I note that I have selected a high deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More and drive moderately old cars. These coverages would be even more expensive if I drove newer cars or selected a lower deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More.  As such, it is very important to balance the benefits of these coverages with their cost.

Physical Damage – Rules of Thumb

I have a few rules of thumb I use in making my decision about whether to buy ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More coverage and at what deductiblesThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More.  They are:

• Never buy insurance on something you can afford to lose or replace.  For example, you might have an old beater car you drive only in the winter.  If you can afford to replace the car or have another car you can drive in the winter, you might not buy CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More or ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More on that car at all.
• Select the highest deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More you can afford.  If you can’t afford to replace your car, especially if it is new or your only vehicle, you’ll want to buy ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More if it fits in your budgetA plan showing targets for income and expenses over a fixed time period, such as a month or a year. More.  You can reduce the cost of these coverages by selecting a higher deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More. You can review your budgetA plan showing targets for income and expenses over a fixed time period, such as a month or a year. More and your savings to see how much you can afford to repair or replace a vehicle if it is damaged or stolen.  This review can inform your selection of a deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More.
• Always put ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More on at least one car if you rent cars for personal use with any frequency.  As mentioned below, your car insurance will cover you when you rent a car up to the maximum coverage you have on any one vehicle.  If you rent cars for only a few days a year, the cost of the rental car company’s insurance will be less than the cost to cover one of your cars for physical damage.  My experience, though, is that rental-car companies’ insurance is very expensive and I can afford to put ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More coverage on one of my cars for my annual cost of buying coverage on rental cars.

Towing and Labor

Some insurers offer to insure you against the costs of towing and labor if your car breaks down.  Examples of the labor costs that are insured under this coverage include unlocking your car, changing a tire, gas, oil or water delivery, and jump-starting your car.  To be clear, your car insurer will not pay for any repairs to your car once it has been towed. It just covers costs to get you off the side of the road.

This coverage is very similar to what is available from such entities as the American Automobile Association (AAA) or the Canadian Automobile Association (CAA).  If you are interested in this coverage, you’ll want to compare the coverage and cost from your insurer with that from other entities. For example, depending on what level of service you buy, AAA will tow your car for either five or 100 miles.  By comparison, towing coverage under a personal auto policy is capped at the dollar amount of the limit you purchase. As you make the cost comparison, you’ll want to consider whether you use any “free” services from the other entities.  Also, if you buy this coverage, remember to use it if you find yourself stranded. I was so rattled by being forced off the road and onto the median by a truck in a couple feet of snow that I forgot I had this coverage. I ended up paying the tow bill myself.  Oops!

Exclusions

There are lots of exclusions in an auto policy.  Some important exclusions I have seen include:

• You are not covered for intentional acts.  For example, if you are mad at another driver and intentionally run your car into the other driver’s car, your insurance company won’t pay for any damage or injuries.
• You are generally not covered if you are using your car in a business related to cars.  Driving your car for Uber or Lyft or similar is almost always excluded. Also, if you park, sell or repair cars, any damage to or caused by those vehicles will not be covered.
• You are usually not covered if you are driving a vehicle other than a car, pickup or van for any type of work.
• You are not covered for injury to anyone who is your employee, unless it is a domestic employee.  We always added our nannies on our insurance policies as drivers to make sure there was no question that they were covered.

Tips about Renting Cars

Your auto policy will cover you and a rental car in the same way as it covers the vehicle on your policy that has the greatest coverage.  For example, let’s say you own two cars – a new one with $500-deductible ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More coverage and an old one with no physical damage coverageAn insurance coverage that protects you when you cause damage to your own property, such as in a car accident, or without human cause, such as fire, hail, storm or earthquake. More.  Your insurer will provide $500-deductible ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More on any cars you rent.

The one exception is that many insurers won’t cover the charges from the rental company for the loss of use of its vehicle.   That is, the rental company charges the renter for the costs it incurs and the profits it loses because the car is being repaired and not available for rent.  These charges are known as loss-of-use charges. These charges can be very expensive, even more than the costs to repair the car. In all our years of renting cars, we have only had one claim.  One of our nannies left her purse in plain sight in a locked rental car when she took the kids to the beach. Someone broke the back passenger window to grab her purse. In that case, our insurer paid for the damage to the car under our ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More coverage after we paid the deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More.  It also argued with the rental car company about the loss-of-use charges. In the end, we did not have to pay anything other than our deductibleThe amount that you pay before the insurer starts reimbursing you either in part (see coinsurance) or in full. Deductibles can apply per claim (as is usually the case for auto collision and homeowners... More.

When renting cars, I decline all of the insurance coverage offered, taking my riskThe possibility that something bad will happen. More that I might have to pay for loss of use.  But, I also make sure I always have ComprehensiveAs it related to car insurance, a coverage that reimburses you for damage to or loss of your car from any one of a list of specified perils other than a collision.  Covered perils include theft, fire... More and CollisionInsurance coverage that reimburses you for damage to your car when it impacts another vehicle or object or rolls over.   More on at least one car so that coverage and, even more importantly, the insurer’s leverageMagnifying returns through the use of debt. For example, assume you borrow $80 for an investment you buy for $100. If the total return on the underlying investment is 5% or $5, your return on your inv... More in negotiating with the car rental company are available when I rent cars.

Susie Q

Susie Q is a retired property-casualty actuaryA professional who assesses and manages the risks of financial investments, insurance policies and other potentially risky ventures. Source: www.investopedia.com/terms/a/actuary.asp More and mother of two adult children.  As her children were moving from their teens into their 20s, she found she was frequently a resource on many, many financial decisions and she had insights and information she could provide to them on a wide array of financial decisions.  She spent a significant portion of my career building statistical models of all of the financial risks of an insurance company and interpreting their findings to help senior management make better financial decisions.  She is the primary author at Financial IQ by Susie Q and volunteers with other organizations related to financial education.