“How Homeowners and Renters Insurance Can Protect Your Belongings”

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What Does Auto Insurance Typically Cover?

Auto insurance policies generally include several types of coverage, each designed to handle different expenses following an accident. Each type of coverage has a limit, which is the maximum amount your policy will pay after an accident. However, personal belongings, such as items stolen from your vehicle, are not covered under an auto insurance policy.

Understanding what car insurance covers—and what it doesn’t—can help you choose the right coverage for your needs. Here are some of the various types of auto insurance and what they typically cover:

Liability Insurance

This type of insurance pays for expenses resulting from an accident you cause. It covers medical expenses for the other driver and property damage but does not cover your own vehicle. For instance, liability insurance would cover hospital bills for an injury another driver suffers in an accident that was your fault. However, it does not cover any medical costs for injuries you suffer or damage to your car if the accident was your fault.

Comprehensive Insurance

Comprehensive insurance covers damage caused by events out of your control, such as weather-related incidents, hitting a deer, falling objects, or car theft. If your car is stolen and not recovered, comprehensive insurance will reimburse you for the value of your car. While personal belongings aren’t covered, comprehensive coverage can help minimize costs if your car is stolen or vandalized. Depending on your policy, you may also be entitled to a rental vehicle.

Collision Insurance

Collision insurance covers damage caused when your car collides with another vehicle or an object, such as a building, telephone pole, or tree. It also covers damage caused by potholes or if you roll your car. Note that collision coverage only applies if the event occurred while you were driving. For example, if a tree branch falls on your car while it’s parked, the damage would be covered by comprehensive insurance. Lenders usually require comprehensive and collision insurance when you lease or finance a car, but these types of coverage aren’t mandated by law if you own your vehicle outright.

How Homeowners or Renters Insurance Can Fill the Gap

Homeowners insurance covers loss or damage to property in your home, such as furniture, housewares, and electronics. What you might not know is that the personal property coverage in a homeowners or renters insurance policy may help cover your belongings if they’re stolen from your car or another location outside your home.

There are usually limits on coverage for higher-priced items such as jewelry, collectibles, sports equipment, fine art, and computers. If you need additional coverage for more valuable items, you’ll have to buy a “floater” policy for those items. Items not in your home may have a lower coverage limit. Your homeowners policy should detail how much coverage it provides for personal property in a different location. Purchasing a floater, also known as an endorsement, is a way to raise the coverage limits of specific high-value items. When raising coverage limits, your company may require you to have the items appraised.

What to Do if Your Vehicle Is Broken Into or Stolen

Discovering that your car was broken into—or even worse, stolen—is certainly a headache, but try not to panic. Here are steps you should take to minimize the damage:

1. Call Local Law Enforcement: Make a note of the items that were stolen and take pictures of any parts of the car that were damaged. Your insurance company will likely also want a copy of the police report if you file a claim for a break-in.
2. Gather Your Information: If your car was stolen, gather documentation related to your vehicle and auto loan. This will make the process easier as you speak with the police and your insurance company. Some of the information you’ll need includes your license plate number, the title showing you’re the owner of the car, any recent photos of the car, recent mileage, and service records.
3. Let Your Insurer Know: Whether you think you’ll have coverage for the theft or not, it’s important to inform your insurer that your car was stolen. This is to protect you from being liable for any actions the thief may take while they have your car. If you have comprehensive coverage, you can begin a claim to get compensated for the loss of your vehicle.
4. Contact Your Lenders and Bank: If any credit or debit cards were taken, contact the card issuers or bank immediately to block access to the accounts and get new cards to protect yourself from identity fraud. You also have the right to place a temporary security alert on your credit reports.

The Bottom Line

Car insurance provides crucial financial protection in the event of an accident. It typically pays for injuries and property damage you cause, and additional coverage options may be available. However, there are some things car insurance doesn’t cover, including personal belongings. If personal items are damaged or stolen from your car, your homeowners insurance policy might fill the coverage gap.

For any mortgage service needs, call O1ne Mortgage at 213-732-3074. We are here to help you with all your mortgage requirements.

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