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Auto Insurance

We hear lots of people talking about state minimum coverage.  Lets take a minute to look at what that really means.  State minimum coverage is liability only with $12,500/$25,000  (per person/per accident) and another $10,000 property damage.  A state minimum policy only covers $12,500 of an single person’s medical bills.  That barely even gets you started at a hospital.  You would be responsible for the remaining portion of the medical bill.

 

Here at OhioLTC we believe in better than legal coverage for less.  We generally recommend a liability limit of $100,000/300,000 with $100,000 property damage.  We specialize in shopping around to provide this better than legal coverage at less then that other place with the catchy jingle.  This will provide you peace of mind without breaking your bank.

 

When you’re ready to take the next step just click “request a quote” and enter some basic information.  Let us know how you would like to be contacted and we will get back to you promptly, usually within 2 business hours!

 

The basics of buying auto insurance

These days we are bombarded with information and hype about saving money on auto insurance.  Ohio LTC believes in keeping you much more than legal for less.

 

Auto Insurance FAQ

Financial Responsibility Law

Ohio requires you to comply with the state’s Financial Responsibility (FR) Law. The FR law requires each Ohio driver to demonstrate an ability to pay for injuries or damages they cause. Buying auto liability insurance is the easiest way to comply. Home equity or other assets can be pledged as explained in this link.

Minimum Ohio Requirements

Bodily Injury Liability Coverage: $12,500 per person injured per accident with $25,000 maximum for all persons injured in the accident.

Property Damage Liability Coverage is $7,500 maximum per accident.

Why should I get more coverage than the minimum?

The minimum requirements have not been increased for inflation for many years.  If you were hurt in an accident and unable to work for months and had medical bills to pay would $12,500 help much?  Would $7,500 even pay half of the cost of a  newer car of average value? Without adequate coverage, the law allows the victim to take any assets that you may have in order to cover the excess costs.

The real winners with minimum coverages are the insurance companies pushing these limits because they cap their losses per accident to $25,000 for injuries and $7,500 for property damage.  After that you are on your own.

I can only afford minimum coverage. What can I do?

Let your independent agent shop for you. Ohio has the 13th lowest auto insurance rates in the country. Independent agents often can find lower rates with more complete coverage by packaging home and auto policies or finding other discounts by shopping for their customers.

Other factors that impact your auto insurance premiums

  • Auto insurance premiums are linked to the type of vehicle driven. If you’re buying or leasing a new car, check the insurance rates before you make your final choice. For example, SUVs, convertibles and performance vehicles typically cost more to insure.
  • Safety devices on your car can help reduce your premiums. If you’re buying or leasing a new car, consider getting one with anti-lock brakes, side air bags, automatic seat belts and daytime running lights.
  • Anti-theft devices on your car, such as an alarm system and global positioning system – so that your car can be located if stolen – can help reduce your premiums.
  • Where you park your car can also impact premiums. If you have access to an indoor garage or locked parking lot – places that decrease the likelihood that your car will be stolen – you may qualify for lower premiums.
  • The geographic region in which you live may impact your premiums. For example, areas prone to extreme weather – hail, wind storms, hurricanes, etc. – higher traffic patterns or higher risk of theft may have higher insurance rates. If you live in an area prone to extreme weather, check whether your policy includes comprehensive coverage on your car to cover potential damage from storms.
  • Your driving record – tickets, accidents, DWIs/DUIs (driving while intoxicated/ driving under the influence citations) – directly affects your premium.
  • The number of claims you have previously filed impacts your insurance costs. Consider not filing claims for smaller events to avoid premium increases.

Finally, the cost of your insurance is linked to your policy’s deductible. The deductible is the amount of money that you agree to pay as part of a claim before your insurer pays the remaining amount toward that claim. For example, if your vehicle incurred $1,000 of damage in an accident and your deductible was $250, you would pay the first $250 and your insurer would pay the remaining $750. The higher the deductible, the lower the premium.

Where can I get more information?

The Auto Insurance On-Line Toolkit, available at www.insurance.ohio.gov, provides guidance on auto insurance needs for different life stages, information on state minimum requirements and a list of frequently asked questions about auto insurance. There are also links to the Bureau of Motor Vehicles and National Association of Insurance Commissioners’ (NAIC) web site.

Ohio insurance consumers with questions and concerns about their insurance can call the Department’s consumer hotline at 1-800-686-1526.

What is in a basic auto policy? (Terms defined here)

Your auto policy may include six coverages. Each coverage is priced separately.

1. Bodily Injury Liability

This coverage applies to injuries you, the designated driver or policyholder cause to someone else. You and family members listed on the policy are also covered when driving someone else’s car with their permission.

It’s very important to have enough liability insurance, because if you are involved in a serious accident, you may be sued for a large sum of money. Definitely consider buying more than the state-required minimum to protect assets such as your home and savings.

2. Medical Payments or Personal Injury Protection (PIP)

This coverage pays for the treatment of injuries to the driver and passengers of the policyholder’s car. At its broadest, PIP can cover medical payments, lost wages and the cost of replacing services normally performed by someone injured in an auto accident. It may also cover funeral costs.

3. Property Damage Liability

This coverage pays for damage you (or someone driving the car with your permission) may cause to someone else’s property. Usually, this means damage to someone else’s car, but it also includes damage to lamp posts, telephone poles, fences, buildings or other structures your car hit.

4. Collision

This coverage pays for damage to your car resulting from a collision with another car, object or as a result of flipping over. It also covers damage caused by potholes. Collision coverage is generally sold with a deductible of $250 to $1,000. Raising your deductible lowers your premium.

Even if you are at fault for the accident, your collision coverage will reimburse you for the costs of repairing your car, minus the deductible. If you’re not at fault, your insurance company may try to recover the amount they paid you from the other driver’s insurance company. If they are successful, you’ll also be reimbursed for the deductible.

5. Comprehensive/Other than Collision

This coverage reimburses you for loss due to theft or damage caused by something other than a collision with another car or object, such as fire, falling objects, missiles, explosion, earthquake, windstorm, hail, flood, vandalism, riot, or contact with animals such as birds or deer. Comprehensive insurance will also reimburse you if your windshield is cracked or shattered. Comprehensive insurance is usually sold with a $100 to $500 deductible, though you may want to opt for a higher deductible as a way of lowering your premium.

States do not require that you purchase collision or comprehensive coverage, but your lender may insist you carry it until your loan is paid off.

6. Uninsured and Underinsured Motorist Coverage

This coverage will reimburse you, a member of your family, or a designated driver if one of you is hit by an uninsured, underinsured or hit-and-run driver.

Can I drive legally without insurance?

Almost every state requires you to have auto liability insurance. All states also have financial responsibility laws. This means that even in a state that does not require liability insurance, you need to have sufficient assets to pay claims if you cause an accident. If you don’t have enough assets, you must purchase at least the state minimum amount of insurance. But insurance exists to protect your assets. Trying to see how little you can get by with can be very shortsighted and dangerous.

If you’ve financed your car, your lender may require comprehensive and collision insurance as part of the loan agreement.

What if I lease a car?

If you lease a car, you still need to buy your own auto insurance policy. The auto dealer or bank that is financing the car will require you to buy collision and comprehensive coverage. You’ll need to buy these coverages in addition to the others that may be mandatory in your state, such as auto liability insurance.

If you’ve financed your car, your lender may require comprehensive and collision insurance as part of the loan agreement.

  • Collision covers the damage to the car from an accident with another automobile or object.
  • Comprehensive covers a loss that is caused by something other than a collision with another car or object, such as a fire or theft or collision with a deer.

The leasing company may also require “gap” insurance. This refers to the fact that if you have an accident and your leased car is damaged beyond repair or “totaled,” there’s likely to be a difference between the amount that you still owe the auto dealer and the check you’ll get from your insurance company. That’s because the insurance company’s check is based on the car’s actual cash value which takes into account depreciation. The difference between the two amounts is known as the “gap.”

On a leased car, the cost of gap insurance is generally rolled into the lease payments. You don’t actually buy a gap policy. Generally, the auto dealer buys a master policy from an insurance company to cover all the cars it leases and charges you for a “gap waiver.” This means that if your leased car is totaled, you won’t have to pay the dealer the gap amount. Check with the auto dealer when leasing your car.

If you have an auto loan rather than a lease, you may want to buy gap insurance to protect yourself from having to come up with the gap amount if your car is totaled before you’ve finished paying for it.

Do I need insurance to rent a car?

When renting a car, you need insurance. If you have adequate insurance on your own car, including collision and comprehensive, this may be enough.

Before you rent a car:

1. Contact your insurance company.

Find out how much coverage you have on your own car. In most cases, the coverage and deductibles you have on your personal auto policy would apply to a rental car, providing it’s used for pleasure and not business. If you don’t have comprehensive and collision coverage on your own car, you will not be covered if your rental car is stolen or if it is damaged in an accident.

2. Call your credit card company.

Find out what insurance your card provides. Levels of coverage vary.

 


 

If you don’t have auto insurance, you will need to buy coverage at the car rental counter. The following coverages are available to you at the rental car counter:

1. Collision Damage Waiver (CDW).

Sometimes called a Loss Damage Waiver (LDW), this coverage relieves you of financial responsibility if your rental car is damaged or stolen. The CDW may be void, however, if you cause an accident by speeding, driving on unpaved roads or driving while intoxicated. This coverage generally costs between $9 and $19 a day. If you have comprehensive and collision on your own car, you may not need to purchase this coverage.

2. Liability Insurance.

This provides excess liability coverage of up to $1 million for the time you rent a car. Rental companies are required by law to provide the minimum level of liability insurance required by your state. Generally, this does not offer enough protection in a serious accident. If you have adequate liability coverage on your car or an umbrella policy on your home/auto, you may consider forgoing this additional insurance. It generally costs about $7 to $9 a day. If you don’t own a car, and rent cars often, consider purchasing a non-owner liability policy. This costs approximately $200 – $300 per year. Frequent car renters sometimes find this more cost-effective than constantly paying for the extra liability coverage.

3. Personal Accident Insurance.

This provides coverage to you and your passengers for medical/ambulance bills. This type of insurance, usually costs about $3 per day, but may be unnecessary if you are covered by health insurance or have adequate medical coverage under your auto policy.

4. Personal Effects Coverage.

This provides coverage for the theft of personal items in your car. However, if you have homeowners or renters insurance, you may be covered for items stolen from the car, minus your deductible. You need to have receipts or other proof of ownership. This type of insurance usually costs about $1.25 per day. Some rental car companies combine personal accident and personal effects coverage together as one type of insurance, while others sell it individually.

The cost of insurance at the rental car counter will vary depending on the rental car company, state, and location of the dealer and the type of car you rent.

Some rental car companies may check your credit and driving history and may deny coverage. Check with the rental car company to find out its policy.

If I want to get a bond or post collateral instead of purchasing insurance, what is required?

Ohio law allows for the following alternatives to automobile insurance:

  • A certificate issued by the BMV, after proper application and approval, indicating that money or government bonds in the amount of $30,000 is on deposit with the Ohio Treasurer Richard Cordray;
  • A certificate of bond issued by the BMV, after proper application and approval, in the amount of $30,000 signed by two (2) individuals who own real estate having equity of at least $60,000;
  • A certificate of self-insurance issued by the BMV, after proper application and approval, to those with more than 25 motor vehicles registered in their name or a company’s name;
  • A $30,000 bond issued by an authorized surety or insurance company.