Protect Against Insurance Bad Faith: Know Your Auto Insurance Terms
You know that auto insurance is required by state law, and that there can be serious consequences if you do not carry a policy according to the mandatory coverage requirements. These standards are established by the Mississippi Insurance Department to protect others in the event you cause or contributed to an accident. However, other aspects of your insurance policy are also intended to cover you as the policyholder. If you sustain losses, you may have rights as a first-party claimant. The problem is that you may run into the same obstacles when filing a claim, even when you are dealing with your own insurance company. At times, an insurer’s tactics may violate Mississippi law on insurance bad faith. You cannot fully understand your rights unless you know the terminology, so here are a few definitions that may be helpful.
- Premium: This is essentially the price you spend to purchase an insurance policy from a provider, with covers your losses and protects you against claims from others. The details of your policy may vary, but you will typically be required to pay premiums on a monthly, yearly, or semi-annual basis.
- Deductible: When you file a claim, you are often required to pay some amount out-of-pocket amount before the cost triggers coverage under your policy. This amount is referred to as your deductible, and it is often closely related to your premium. For instance, your deductible is usually lower when you pay higher premiums, and vice versa.
- Personal Injury Protection (PIP): If you are injured in an accident due to your own fault, PIP will pay a portion of medical costs expended to treat you and your passengers. Some policies will even compensate a percentage of lost wages, but you will not be able to recover for pain, suffering, and other non-economic damages. PIP is an optional add-on to insurance coverage in Mississippi.
- Collision Coverage: This term refers to coverage that applies if your car is damaged in an accident with another car or in a single-vehicle incident. Most collision coverage is linked to the fair market value of the car, and this option will increase your premiums. Therefore, if your vehicle is older and not worth the extra expense, you may opt out. You are not required to carry collision on your policy by law, but most lenders require it because it protects their investment if the vehicle is damaged.
- Comprehensive Coverage: Your car can be exposed to property damage even when it is parked, such as by theft, falling objects, animals, and natural disasters. Particularly in Mississippi, hurricanes can lead to considerable damage or even total destruction of the vehicle. Comprehensive coverage provides reimbursement for the costs to repair or replace your vehicle, when the damage is not related to an auto accident.
- Uninsured (or Underinsured) Motorist Coverage: Uninsured Motorist coverage is first-party insurance. This means that it protects you in the event you are involved in an accident with another person who is uninsured or who has less insurance than you (underinsured). This is very important coverage. It is not required that you have uninsured motorist coverage in Mississippi but in order to decline coverage, you must sign a waiver. This is not recommended! Uninsured motorist coverage is to protect you and should not be waived. This coverage follows you wherever you go – meaning that you are even protected in the event you are injured in another’s persons vehicle or even if you are injured as a pedestrian.
Talk to a Biloxi, MS Insurance Bad Faith Attorney if You Have Problems with Claims
At the Law Offices of Judy Guice in Biloxi, MS, our legal team has considerable knowledge in fighting for the rights of policyholders when faced with insurance bad faith. If you are involved in a dispute with your insurance company, please contact our office to set up a consultation regarding your legal remedies.