What Is In An Auto Policy

1. Bodily Injury Liability

This coverage applies to injuries that 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 province-required minimum to protect assets such as your home and savings.

2. Property Damage Liability

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

3. Direct Compensation Property Damage (DCPD)

This coverage covers damage to – or loss of use of – an automobile or its contents, to the extent that the driver of another vehicle was at fault for the accident. It is called “direct compensation” because, even though someone else caused the damage, the insured person collects directly from his or her insurer instead of from the person who caused the accident.

4. Accident Benefits

This is also referred to as Section "B" coverage. This is a "no fault benefit" that provides medical and rehabilitation expenses, funeral benefits, death benefits, and loss of income benefits.  Because it is a "no fault" coverage, payable by your own insurer and is payable even if you are at fault for the accident.

5. Loss or Damage to Automobile

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 — the higher your deductible, the lower 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.

Comprehensive:
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 is usually sold with a $100 to $250 deductible, though you may want to opt for a higher deductible as a way of lowering your premium.

Comprehensive insurance will also reimburse you if your windshield is cracked or shattered.

Provinces do not require that you purchase collision or comprehensive coverage, but if you have a car loan, 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 or hit-and-run driver.

Underinsured motorist coverage comes into play when an at-fault driver has insufficient insurance to pay for your total loss. This coverage will also protect you if you are hit as a pedestrian.

** For more detailed information on coverages, exclusions and policy conditions see the S.P.F. No. 1 Standard Automobile Policy form for New Brunswick.