Florida Auto Insurance: A Dictionary for the Most Common Insurance Terms

Dec. 17th, 2015   /   , , ,

Florida Auto Insurance: A Dictionary for the Most Common Insurance Terms

When it comes to purchasing auto insurance, the terms that are used can be a bit overwhelming. In order to help you, we’ve compiled a list of terms and a breakdown of their definitions. The list is split into coverage that protects you and coverage that protects others. Coverage that protects you is the coverage that will cover you and your household should you get into an accident. Coverage that protects others is the coverage that kicks in during an accident at which you are found to be at fault.

The basics: in the state of Florida, the minimum coverage an individual is legally required to have is $10,000 in Personal Injury Protection and $10,000 in Property Damage Insurance.

Coverage that protects you:

Personal Injury Protection (PIP):
What it is: required coverage that will pay for medical costs related to your accident.
How it works:  Standard PIP covers 80% of your medical bills related to your motor vehicle accident up to $10,000 (e.g: PIP will pay $800 for a related medical bill of $1000. They will make payments of 80% on all your bills until the $10,000 limit is reached).
When it’s applicable:  PIP is required in the state of Florida. It will pay for medical treatment for injuries to you or a family member, regardless of fault. Additionally, your Personal Injury Protection will cover bills if you are hurt by a car accident as a pedestrian or on a bicycle. It will not cover any injury you sustain while riding a motorcycle. Your PIP may have a deductible. If that’s the case, the insurance policy will not cover your medical costs until you satisfy the deductible. One word of caution, you MUST get medical treatment within 14 days of the auto accident in order to be eligible for the full $10,000 worth of coverage. If you do not, it is possible your PIP coverage will only be $2500.

Medical Payments (Medpay):

What it is: optional coverage that will pay for medical costs related to your accident.
How it works: Medpay covers the 20% of medical bills up to $10,000 that your PIP leaves you to pay out of pocket. It’s a supplement to your PIP.
When it’s applicable:  Medpay will cover the 20% for injuries you, a family member, or uninsured passenger incurs regardless of who’s at fault.

Collision Insurance:

What it is: optional coverage that will reimburse the insured for any damage sustained to their car during an accident.
How it works: If an accident occurs, this coverage will cover the physical damage to your vehicle.
When it’s applicable:  Collision will be of use for damages to your case from a car accident. A deductible may apply depending on the policy you purchase.

Uninsured/ Underinsured Motorist Insurance:

What it is: Optional coverage. Uninsured motorist coverage protects you if you’re in an accident with an at-fault driver who doesn’t carry liability insurance. Underinsured motorist coverage steps in when you’re in an accident with an at-fault driver whose liability limits are too low to cover your damages and/or medical expenses.
How it works: If an accident occurs, for which you’re not at fault and the other driver involved does not have enough coverage, your own insurance will compensate you up to your designated policy limits.
When it’s applicable:  you’re involved in an accident for which you’re not at fault and the other driver does not have enough coverage. In order to have uninsured/underinsured coverage, one must also purchase bodily injury coverage.

Coverage that protects others:

Property Damage Insurance:

What it is: required coverage that helps pay for the damage that you cause to another vehicle, or other types of property.
How it works: If an accident occurs and you’re found to be liable, this insurance will cover the physical damage to the other party’s property.
When it’s applicable:  Collision will only be of use if you’re at fault for a motor vehicle accident. It will not cover any damage to your personal property.

Bodily Injury Liability:

What it is: optional liability coverage that helps cover the cost of damages you are responsible for as a result of an accident you cause.
How it works: If an accident occurs and you’re found to be liable, this insurance will compensate the injured party for permanent loss, future medical expenses, wage losses, personal losses, and for pain and suffering.
When it’s applicable:  Bodily injury protects you if you injure someone in an accident. This will compensate others up to your policy limits and provide legal representation for you in the event that you are sued.

If you need help with your auto insurance policy, contact us at daronberg@aronberglaw.com or call us at 561-266-9191.

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