Typical Arizona Automobile Insurance Coverage

The following are the usual coverages that make up the typical auto insurance policy in Arizona.

Liability:

This provides coverage up to the amounts stated in that person’s declarations sheet. It provides for damages that an insured becomes liable to pay due to an accident or other negligence. Typically, the insurance company will investigate, litigate and settle claims brought against driver or owner of the vehicle. If the case is litigated, the insurance company will hire a lawyer to defend the driver. If you are the at-fault driver, your insurance company will defend you under the liability coverage provision.

Typically liability insurance covers also newly acquired cars, or temporary substitute cars, such as loaner or rental cars. Insureds under the liability coverage include the driver, the driver’s spouse, and relatives. The liability coverage excludes non-owned cars, cars that you rent or lease to other people, cars that you use to carry persons for a charge, such as car pools, or injuries to your fellow employees in your car for business purposes.

Comprehensive:

Comprehensive coverage is insurance coverage that helps pay for losses to an insured car due to fire, theft, or other losses, not the result of a collision. Typically the insurance company will only pay for losses above the deductible on your policy.

Medical Payment or “medpay”:

This coverage covers reasonable medical expenses up to the amount stated in the declarations page which are incurred due to bodily injuries caused by an automobile accident. Typically the expenses are limited to a several year period after the event, usually two or three years. “Reasonable” medical expenses are usually those consistent with the usual fees charged by medical providers in your community. The insurance company typically pays medical bills to you, your spouse, or other persons in your car either as a passenger or driver. In some circumstances, pedestrians may qualify for medpay coverage. Occasionally the insurance company will review the medical bills you submit to determine if they were “reasonable and necessary.” If more than $5000 in medpay coverage is paid, however, the insurance company has the right to be reimbursed from any settlement or judgment against the driver who caused the injuries.

Collision

This coverage provides for an insured car that is involved in an accident, subject to your deductible. This coverage provides payments to repair the damaged vehicle, or pays the cash value of car if it is not repairable

Under-insured Motorist.

UIM stands for “under-insured motorist,” or motorists whose automobile insurance policy limits are insufficient to cover a specific loss. UIM coverage pays you, or other people covered under your policy, for bodily injury damages if the other driver is liable and has coverage that does not fully compensate you for your losses. The amount paid by your insurer is up to the amount of UIM coverage you have purchased, stated in your declarations sheet. In effect, your insurance company provides an additional layer of insurance coverage in addition to the other driver’s insurance company when you make a UIM claim.

Uninsured Motorist

UM stands for “uninsured motorist,” or motorists who do not have any automobile insurance. Arizona UM coverage protects you and other people covered under your policy for losses caused by an uninsured driver who is liable, up to the limits of the amount of UM coverage you have purchased. In effect, your insurance company acts as the other driver’s insurance company when you make a UM claim.