Liability is written in one of two ways; split limit or combined single limit. The split limit example we will use is $100,000/$300,000/$100,000. This means that the policy will pay for the liability you incur for bodily injury to an individual or individuals at $100,000 per person up to a maximum of $300,000 per accident. For damage you may cause to the property of others that you become liable for, it will pay a maximum of $100,000 per accident. Many property damage losses will exceed $100,000. For example, a tractor trailer with a load of goods could go as high as $500,000. You may purchase higher limits on a split limit policy, but the property damage will always remain as a lower limit. Combined single limit coverage, on the other hand, means that you have $1,000,000 of coverage that applies to the total amount of the bodily injury and property damage incurred. This is the recommended way of purchasing auto liability insurance as there are fewer limitations on the loss.
Medical payments under the auto insurance policy pays for injury sustained by the driver of the vehicle or anyone else in the vehicle. This is known as a complimentary payment. Guilt is not necessary for payment, only injury needs to occur. It is written as excess coverage which means that it will pay the difference between what the individual’s health insurance, and/or Workers Compensation will pay, and the actual amount of the bill. The lowest recommended limit is $5,000.
If you are involved in an accident with an individual who is uninsured and they are found to be at fault, injury to your driver and/or people in your vehicle may result in your being responsible to them. Uninsured Motorist coverage provides protection against this and it should be written in the same limit as the automobile liability. ($1,000,000)
Underinsured motorist is similar to uninsured motorist. However, it protects you against those who have low limits of liability that are insufficient to cover the loss. Some states are “no-fault states” and have coverages different than described above. Each no-fault state is different and needs to be addressed individually as to what coverage is required and/or available.
Physical Damage Collision
Collision coverage protects you against loss to your owned auto when it is involved in an auto accident. It is almost always written on an actual cash value basis less the deductible. The car will be repaired, or it will be replaced if the cash value is less than the cost of repair. Deductibles for collision range from $100 and up. The church should carry as high a deductible as it can absorb in the repair of the vehicle.
Physical Damage Comprehensive
Comprehensive coverage protects you against loss other than collision such as fire, vandalism, window breakage, theft, etc. Deductibles for comprehensive usually start at $100 and up. Again, the church should purchase the highest deductible it can absorb.
Hired & Non-owned Auto
This was addressed in the general liability section above.
Hired Car Physical Damage
This coverage is often purchased at the time you rent a car on the rental car contract and includes coverage for the loss of use to the rental car company while the vehicle is being repaired. When you rent a car, the rental car agreement obligates you to reimburse them for loss of use. Purchasing insurance from the rental car company is a very expensive way to cover this exposure. Even purchasing it on your church automobile insurance policy, while not as expensive, often does not provide for the loss of use coverage you contracted for when you rented the car. You may be able to secure this coverage through your VISA or MasterCard provider. Check with your credit card company to see if this coverage is available to you, and if not, find one that does and consider changing providers.
Employees and Volunteers As Insureds
Your church probably utilizes many employees and volunteers to drive your vehicles for various church functions. If they were to have an accident while using your auto, the church is covered for the loss as you are the named insured on the policy. Your employees and volunteers, however, are not covered individually if sued unless specifically added as an insured to your policy by endorsement. It is very important that both your employees and volunteers be included as insureds under this policy.