Little Known Auto Insurance Issues

Auto insurance is complicated, and there are lots of issues you need to know about, such as what kind of coverage to get and the amount of your deductible.

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Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates...

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance...

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Reviewed byDaniel Walker
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UPDATED: Apr 24, 2020

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It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We partner with top insurance providers. This doesn't influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Things to Remember...

  • Gap Insurance is mainly designed around people who are buying a brand new car
  • Replacement parts from the manufacturer are often referred to as OEM parts versus parts from third parties are referred to as aftermarket parts
  • Make sure you know the difference on all your deductibles before you sign the dotted line
  • Take all the time you need when making that claim to know exactly where you stand and how costs are derived
  • Underinsured protection applies to motorists who are at-fault for an accident
  • Uninsured is a policy to pay for treatment, property damage, and other costs associated with an auto accident

There will come a time in your life when you just might have to make a claim on your auto insurance policy. This may not even be your fault. Someone could just hit you in a parking lot. This incident may increase your auto insurance rates.

You can find and compare auto insurance quotes from many different insurance companies, just enter your zip code above right now!

In truth, there is a lot most of us don’t know about auto insurance until we are in the thick of a situation like this.  Filing a claim may seem easy, but a few issues could leave you scratching your head in wonderment:

Close the Gap

There is a type of auto insurance that nobody is ever willing to freely offer customers called Gap Insurance. This just might be the most important type of insurance that you can purchase.

Gap Insurance is mainly designed around people who are buying a brand new car.

The reason is just how much of a value a new car suffers as soon as you sign those papers and drive off the lot.

Let’s say you get into a collision ten minutes after driving off the lot. Your auto insurance will only cover a portion of your auto loan.

Gap insurance fills in the rest so you are not left holding a grand bill for a car that is no longer operable. If you are buying a car that will surely lose its value when you drive away, get that difference covered with some Gap insurance.

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Repair Parts Come in Two Forms

Your auto insurance can also dictate the parts you get with your repairs. Replacement parts from the manufacturer are often referred to as OEM parts. Parts from third parties are referred to as aftermarket parts.

Knowing this difference can ease that understanding of the auto insurance fine print.

This plays out as follows: You take your car in for some repair work after a storm put a tree branch into the back side of your vehicle. You take the car to the repair shop for the work it needs.

The auto insurance company can dictate to that repair shop that they are only going to pay for aftermarket parts. While you may think you’re getting genuine parts, you might actually be getting third party parts.

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Deductibles Vary in Many Forms

Auto insurance policies come polluted with lingo and terms that mean so many different things. Deductibles are one of those terms that come with several meanings.

Knowing the difference can save you plenty of stress in the long run.

You may think you had a collision deductible of a measly $200. Yet, that tree branch hitting your car is comprehensive damage. Your comprehensive deductible could be $1000.

Make sure you know the difference on all your deductibles before you sign the dotted line.

Uninsured and Underinsured Motorists Coverage Rocks Fun Lingo

Underinsured protection applies to motorists who are at-fault for an accident. They have auto insurance, but they don’t have a policy big enough to cover the damages for the accident. Underinsured protection then kicks in to cover the difference.

Uninsured is a policy to pay for treatment, property damage, and other costs associated with an auto accident.

This coverage comes into play when the at-fault driver does not have any auto insurance. These two coverage’s sound the same, but they cover vastly different situations.

Filing a claim on your auto insurance policy can be tricky and stressful. Take all the time you need when making that claim to know exactly where you stand and how costs are derived.

You can even take this time upfront when you’re signing that new policy.

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Save Money on Your Auto Insurance

You can compare auto insurance rates today!  Just enter your zip code in on this page, and started comparing auto insurance rates for free.  Start saving some money!

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