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Questions 2:   What types of automobile insurance coverages are available for purchase?
A variety of insurance coverages are available to protect against losses associated with the operation of automobiles. The standard automobile insurance coverages are as follows:

Coverage

Description

Section
A

Third Party Liability

Indemnification, up to the policy limit, of the insured for damages arising from bodily injury or property damage caused to innocent third parties from the policyholder’s negligent operation of the insured vehicle.

Direct Compensation Property Damage (“DCPD”)

Covers damages to your vehicle or its contents to the extent that another person operating a vehicle also covered by DCPD is at-fault for the accident. It is called Direct Compensation because the insured collects from their own insurer instead of from the insurance company of the at-fault driver.

Section
B

Accident Benefits

Partial indemnification on a no-fault basis for certain expenses to drivers, passengers or pedestrians who suffer injury or death as a result of an automobile accident. Benefits include medical expenses, funeral expenses, death benefits, income replacement and housekeeping services.

Section
C

Collision

Indemnification, subject to a deductible, of the insured for damages caused to the insured vehicle arising from a collision or upset.

Comprehensive

Indemnification, subject to a deductible, for any damage caused to the insured vehicle for any peril other than collision or upset.

Specified Perils

Indemnification, subject to a deductible, for any damage caused to the insured vehicle for the named perils specified in the coverage. The named perils are included under Comprehensive coverage, thus it is not necessary to purchase both Comprehensive and Specified Perils.

All Perils

Indemnification, subject to a deductible, for all risks unless they are explicitly excluded in the policy text. This coverage combines and adds to the protection provided by Collision and Comprehensive, thus All Perils need not be combined with any other Section C coverages.

Section
D

Uninsured Motorist

Indemnification for the insured for bodily injury and death arising from an accident with an uninsured or unidentified vehicle. In the case of an uninsured vehicle where the owner is identified, this coverage also provides indemnification, subject to a deductible, for property damage to the insured vehicle.

Additional optional policy enhancements known as endorsements also allow you to change, add or reduce the amount of coverage for certain situations. Some of the most common endorsements available for purchase are as follows:

Endorsement

Description

Loss of Use

Pays for a rental car or alternate transportation (such as taxi or train fares) while your car is being repaired.

Liability for Damage to Non-Owned Automobile(s)

Provides physical damage coverage to vehicles that you may operate but do not personally own – such as a vehicle that you have rented or borrowed – subject to a deductible. It also provides Liability, Accident Benefits, Uninsured Automobile and Direct Compensation-Property Damage coverages in specific circumstances.

Depreciation Waiver

Ensures you receive the full value of what you paid for your vehicle – without depreciation – and is specifically designed for new vehicles (typically up to 24 months old).

Family Protection

Pays for injuries to you and your family from the actions of an at-fault, under-insured driver. This coverage ensures that you and your family are covered to your own policy’s limits regardless of the other person’s coverage levels.

Accident Forgiveness

Keeps your premium from increasing in the event of your first at-fault collision.

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