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UPDATED: Aug 24, 2016
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Insurance provides coverage for a variety of different common and not-so-common scenarios. The best policies will cover you for incidents that occur on public roadways and parking lots alike.
These full coverage policies will also provide coverage regardless of who is deemed to be at fault for the loss.
As a vehicle owner and a driver, it is in your best interest to familiarize yourself with the types of coverage that are available before you build a car insurance policy that is suitable for your family.
It is not uncommon for drivers to get involved in parking lot accidents. Compact spaces and inattentive drivers make for chaos. If you lose focus or you do not account for the small size of a space, it is easy to hit a parked car.
While parking lot incidents are most commonly minor fender benders, the costs to repair the resulting damages can be exorbitant if you are left paying them on your own.
Luckily, your auto insurance will help cover some or all of the costs. Explained below, is how your car insurance works when you hit a parked car.
Third-party Damage: Will your carrier pay for these damages?
Car insurance policies can be customized to include several optional forms of coverage, but all policies include liability coverage. Liability coverage consists of bodily injury and property damage cover.
Bodily injury is designed to pay for third-party expenses when someone suffers minor or major bodily injury in an accident that you were negligent for.
Property damage is designed to pay for all of the third-party expenses associated with your negligence in an accident that results in damage to property.
In an incident where you have hit a parked car, you do not typically need to worry about having to deal with an injury claim. You may, however, need to deal with property damage claims.
You will have peace of mind in knowing that you have property damage liability (PDL) on any basic or full coverage car insurance policy that you carry.
How does property damage coverage work?
Liability provides protection for the claims that are made against you by a third-party. Property damage, like bodily injury, is a state-mandated coverage so that people who own and drive vehicles are financially responsible for the damage that they cause.
When you purchase PDL, you know that your policy will pay up to the limits stated on the policy for damages that you would have otherwise had to pay for on your own.
How much your plan pays for depends on the limits that you choose. You can select state minimum requirements that can be as low as $5000 or elect to carry higher limits for added protection.
- Filing a Claim – When you contact your insurer to file a claim after hitting a parked car, the insurer will do an investigation. Fault can be determined quickly when you hit an unoccupied car. After this is settled, the insurer will talk with the other party’s claims adjuster to determine how much must be paid and whether your plan will cover everything.
- Assessing the Damage – When you carry insurance, it is the claims adjuster’s job to settle a claim for the lowest amount possible. They look out for their clients and will make offers that they see adequate to third-parties who are claiming property damage. Property damage cover pays for the repair or the replacement of property that someone else owns.
- How Your Policy Premiums Will Change – A property damage claim for hitting a parked car is an at-fault loss. This means that your premiums will go up at your next renewal even though no one was injured.
Property damage cover does not pay for repairs to your own property.
The claims adjuster will assess the damage and determine the cost of repairs. Most damage to parked cars is minor, but if the damage is serious the adjuster will compare the value of the car to the cost to repair it.
If the fair market value of the car is close to the estimated repair costs, the car may be classified a total loss.
This does not happen often in parking lot incidents, but it is possible when the third-party vehicle is older. If the damage ends up amounting to more than your limits, you may have to cover the remainder with your own money.
The amount of a coverage increase depends on the state where you live and the discounts you are receiving. If the damage is higher than the threshold in your state, you may see an increase in your rates as high as 22 percent.
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Damage to Your Vehicle: Is it covered?
All policies include liability coverage, but not every plan includes physical damage coverage for the covered vehicle. If you hit a parked car in your vehicle, chances are both vehicles are going to end up with damage.
Since you are at fault as the only driver involved in the loss, you cannot go after the other party’s insurance. The only way that your insurance company is going to help cover the cost to repair your vehicle is if you have collision coverage.
How does collision coverage work?
Collision insurance is an optional form of physical damage cover that pays for damage to your car. It will pay for the repairs to your car, up to the market value of the auto if it is damaged in a collision.
Since you are at fault in a parking lot incident, you will be required to pay the deductible that you carry before the damages will be covered. This is why it is very important to choose a deductible that you can reasonably cover as you are building your insurance policy.
Filing a collision claim in addition to a property damage claim for the same incident will not raise your premiums any higher because it is for the same loss.
As you can see, some damages are covered and others may not be. You need to take the time to build yourself a policy that is going to protect you even when you do make the wrong move behind the wheel.
If you are ready to price the cost of a full coverage policy, you should consider pricing the cost of premiums.
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