Idaho Auto Insurance Coverage Basics | What Car Insurance Should I Buy?

Car insurance is a far more complex topic than one might initially think.  There exists a wide variety of automobile insurance coverage types: collision coverage, medical payments insurance, basic liability, underinsured motorists coverage (UIM), uninsured motorists coverage (UM) and more.  Then there are all the numbers.  Things like 25/50, 50/100/25, 300 single limits and many many more.  We have lost count of the number of times clients have come to us and told us about their “full coverage.”  But we have learned most people have no idea what that means or the insurance they have.

Types Of Idaho Car Insurance Coverage Available

Your auto insurance policy is really a bundle of many different insurance coverages.  These are used at different times, in different ways and for different reasons.     Each  coverage has different rules that allow you access to the money that is there to protect and help you for specific losses.

Here is a very basic summary of some of the main types of coverage contained in Idaho auto insurance policies

A. Required Auto Insurance Coverage

1. Liability-Bodily Injury Automobile Coverage

This  coverage protects your financial well-being by paying other people.  It is available when an injury claim is brought against you by a person hurt in a collision you caused.  By law Idaho drivers must purchase a minimum of 25 thousand dollars in liability coverage for a person hurt in a collision and a minimum of 50 thousand dollars for all injuries in a collision.   As you become more financially well-off in life it is important to increase those amounts.

This is the coverage that allows you to take personal responsibility for a mistake you cause that hurts someone without losing your house or business.  One important fact is that each increase in the amount f coverage will cost less.  The first 25 thousand dollars might cost you 200 dollars but 50 thousand in coverage might only be 300 dollars.  And 100 thousand in coverage might only be 350 dollars

2. Liability- Property Damage:

This is again a coverage that pays other people,  In this case it is for the damages to others personal property.   This could be the other person’s car or bicycle or a fence that you hit with your car.  It pays when you cause such damage negligently.  Again, think about the amount of your coverage.  Given the number of vehicles that are worth in excess of 15 thousand dollars on the road today, it may make sense  to get more than the minimum required amount.

B. Optional Auto Insurance Coverage

1. Medical Payments Coverage In Car Insurance:

This pays for medical costs incurred by you and other passengers in your car.  There is lots of variability in this coverage.  Some policies have as as little as $1000 in coverage.   Others as much as $100,000.  You can choose to buy this coverage because the law does not require you to have it.  But medical payments coverage protects people in your own car– friends, family and yourself – without regard to fault.  It is extremely cheap health insurance in essence.

2. Uninsured Motorist Coverage (UM):

Your uninsured coverage is available when the negligent driver who hurts you has failed to buy insurance. It also applies if you get injured in a hit and run incident.  Idaho insurers must give you the opportunity to buy this insurance.  This is insurance that protects you and people you know and love.   If you reject it must sign a waiver form stating that you reject it.  We strongly recommend you BUY UM coverage.  It is usually pretty cheap.   Both UM coverage and UIM coverage below are discussed in a little more depth in this post.

3. Underinsured Motorist Coverage (UIM):

Your underinsured coverage provides protection when a “bad guy” driver has injured you but his insurance coverage is insufficient.  It exists to fully compensate you.  Remember all he is required to have in Idaho is 25 thousand dollars in coverage.  So if the other driver’s insurance does not contain enough money to fully compensate you then you have purchased this to protect yourself.  Just like UM, you have to waive this coverage when you purchase your initial policy.   And just like UM we advise you to BUY IT.

In fact, with both UM and UIM we recommend you purchase as much as you can afford within your budget.

You do have to be aware there are two kinds of UIM coverage:  “Offset” and “Stackable.”    Offset is what most companies sell and it can surprise you.  For example, if you are sold 25 thousand dollars in underinsured coverage the insurance company will take a credit against it for every dollar you recover from the other driver’s insurance.   Idaho drivers are either uninsured or required to have at least that same 25 thousand dollars in coverage.  Thus ths UIM policy of $25,000 never provides a benefit. It is phantom or illusory coverage.  You should consult closely with your agent and understand what you are buying.

4. Collision Coverage:

Collision coverage takes care of losses to your vehicle when you are involved in a collision with another vehicle.  It will have a deductible attached to it.   The deductible is essentially an amount you have to pay before your insurance actually kicks in.

You must pay your deductible before the collision coverage provides a benefit.  Often it is better to use your own collision coverage and to let your insurance company get reimbursed by the bad guy drivers property damage insurance.  But collision coverage will apply even if you are the one who caused the collision.

5. Comprehensive Automobile Insurance Coverage:

This type of coverage exists to take care of damage to your vehicle caused by reasons other than a collision.  For example, if your car is damaged by a falling tree, or in a hail storm or if a windshield breaks.   This also has a deductible in most policies.

6. Add-On Coverage

The first seven are probably the most basic options for your insurance coverage on your car.  Of course, the insurance  industry has many smaller “add-on” coverage that might be right for you.  These include specialties such as roadside assistance, rental car reimbursement, towing  and other smaller benefit coverages.

Our advice is that you review all the possible coverage available when purchasing your auto insurance. Chose those that are right for you.

The number one thing we can say, –– buy the largest amount of uninsured, underinsured and med pay coverage as your budget allows.  Those are the coverages are designed to protect you and the people you love.

If you have any questions, contact Kurt Holzer or any of the other attorneys at Hepworth Holzer, LLP.