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Am I Covered?

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Auto insurance policies are written with very specific verbiage and terminology whose purpose it is to leave no doubt when it comes to what’s covered and what isn’t should an accident occur. Unfortunately, this lingo can often seem like a foreign language or alien-talk to the average consumer. Confounding things further still is the fact that every company and every policy is different. This is where having a dedicated agent is helpful: insurance agents are well-versed in this confusing language and can easily explain policies. While the details of each policy may differ, there are several hot button questions that almost all policyholders will ponder at some point, and for the most part the answers are the same.

Some of the most common “am I covered?” issues:

Lyft/Uber Drivers. With Lyft and Uber taking over Austin, more and more young adults are jumping at the chance to earn some extra money while exuding fairly little effort. And it does seem like a great opportunity: making money driving your own car for a few hours a day? Yes please! But drivers should stop and consider that increased drive time raises your chance of getting in an accident, and what might happen should an accident occur. Almost all personal auto insurance policies specifically exclude coverage if the vehicle is being used to make money. Once you start Lyfting, your car is more or less considered a business and you would need to pursue a commercial policy in order to maintain proper coverage. Considering the cost of an additional policy, or the cost of paying for repairs and damage to yourself, your car, and your passengers should an accident occur, think twice before signing up to become a Lyft driver.

Friends or Family. Many people hesitate to let friends or family drive their car under the impression that anyone else would not be covered should an accident occur. But in most cases, if someone else is driving the vehicle with the named insured’s permission, the accident would still be covered. Don’t think you’ll get off scott-free though: even if you aren’t driving, if your vehicle is in an accident you file a claim, the claim will follow the vehicle, meaning a spike in your premium, not your friend’s.

Mexico. Living so close to the border, plenty of policyholders often wonder if their vehicle will be covered should they decided to take a trip south. But are you covered in Mexico? The answer to this one is less clear. Some Texas policies may allow for Mexico coverage within a certain distance of the border (say, within 100 miles) but some do not. In the case of those that do not, you would need to seek an additional policy for coverage on your vehicle while across the border.

Rental Cars: In general, insurance offered by rental car companies is nothing more than a ploy for them to make more money. Most personal auto policies will cover the insured while driving a rental car, but a word of caution: coverage may extend only under the circumstance of the covered vehicle being in repair, so be sure to discuss with your agent.

This is only a basic guide to common policy questions: as mentioned, each and every company and policy is different, so be sure to discuss these issues and any others that concern you with your agent so you always know what you’re covered for.