What is casualty auto insurance?

Casualty car insurance protects the owner of a car against unforeseen liabilities and losses due to unexpected events such as terrorism, fraud, and theft.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jul 22, 2021

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Here's what you need to know...

  • Casualty car insurance is any type of insurance that covers an individual or company for negligence
  • Once you purchase a policy to cover your own vehicle, the policy is no longer casualty, as it now covers you in the case of someone else’s negligence
  • Before purchasing casualty insurance, speak with a broker to determine your exact needs

One of the most unclear conceptions of the car insurance trade is Casualty insurance.

Liability insurance coverage is the primary type of personal casualty car insurance. Liability covers one or more persons, should they be physically injured in some way in your car or a car involved.

Commercial types of casualty insurance are also available and are explained below.

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Casualty car insurance differs from general auto insurance in that the latter protects the owner of the car.

Some policies only provide liability coverage, while others may include everything from workers’ compensation to earthquake insurance coverage.

Frequently, casualty car insurance policies can be customized for specific types of businesses, such as manufacturing.

This is the primary reason why insurance brokers are in a position to offer vastly dissimilar kinds of services.

What is a casualty car insurance broker?

A casualty car insurance broker speaks and acts for their clients when conferring in negotiations with insurance companies.

The insurance broker assists their clients in obtaining a casualty car insurance policy that best fits their budget and lifestyle while helping them to oversee any current policies and avoid needless dangers.

The services of a Casualty car insurance broker can be separated into basic categories:

  • Insurance rates negotiation – Involves the broker working with the insurance companies using the powers of persuasion to try and obtain the best possible rates and coverage for their clients.
  • Risk management – Involves the broker reviewing their client’s finances and operations to see if they are putting themselves or the company at risk, thus minimizing the need to utilize the casualty policy at all.
  • Loss control services – Involves the brokers looking at cases where clients may have to pay out on their casualty insurance policy while working hard to find ways to ensure that they don’t have to do so again.

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Where can I purchase casualty car insurance coverage?

Casualty insurance can be purchased for cars, trucks, boats, motorcycles, recreational vehicles, and more. Casualty car insurance protects against unforeseen liabilities and losses, due to unexpected accidents.

Because it’s so broad, it encompasses a wide spectrum of areas and instances within the field of insurance and is designed for special circumstances, casualty insurance may include coverage for:

  • terrorism
  • fraud
  • theft

However, if the policy coverage were to be of unmitigated usage, and all of a sudden covered the vehicle itself, it would no longer be only a casualty car insurance policy.

Though not all agents offer casualty car insurance, many do, so it’s important to discuss your need with your agent.

Generally speaking, casualty car insurance covers damages to both the vehicle and the people involved with the vehicle.

This includes individuals in your vehicle or the other person’s vehicle, along with people who were innocent bystanders.

For example, if someone is in your vehicle and is somehow injured therein, your casualty (or bodily liability) insurance policy would pay for their medical costs.

Likewise, if your vehicle was vandalized as a result of a robbery or even a botched attempt, your casualty car insurance (or property liability) would cover any damages as a result.

As you can surmise, casualty car insurance is useful for a great many incidents and criminal deeds.

Commercial casualty and property car insurance is highly useful for owners of businesses.

The policies usually include personal liability, which ensures that employees who are injured in company vehicles will be cared for and compensated for any physical loss or injury.

Fires and floods are not usually covered by casualty car insurance.

Therefore, to protect your vehicle against acts of God such as severe weather, flooding, or fires, it is important to purchase separate insurance policies to guard against just such instances.

Also, it’s imperative that policyholders read the fine print of their insurance scrupulously, in case there is something that is not covered if a claim is ever made against the policy.

In some regions of the country, for example, earthquakes or tornadoes may be covered under a casualty policy, while in other areas it may not. In these cases, specific, separate policies are written, since these acts of God are frequently debarred from indemnification.

Illinois, for example, includes many categories under the heading of casualty insurance, including liability, worker’s compensation, and legal expenses.

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  1. https://en.wikipedia.org/wiki/Casualty_insurance
  2. https://www.ibac.ca/Why-Use-A-Broker/What-a-Broker-Does.aspx
  3. https://www.libertymutual.com/auto/car-insurance-coverage/bodily-injury-liability
  4. https://www.cbsnews.com/media/insurance-what-exactly-constitutes-an-act-of-god/
  5. https://www.cbsnews.com/news/will-insurance-pay-for-storm-damage-to-your-car/

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