NJ CAR INSURANCE 1

What is Auto Insurance? Auto Insurance provides protection from losses resulting from owning and operating an automobile. The insurance covers losses to the insured's property and losses for which the insured is liable as a result of owning or operating an auto. 2

WHERE SHOULD YOU START? Understand NJ Insurance Laws Understand your needs How much coverage can I afford? What happens if I decide I’m going to drive without insurance? 3

WHAT IS IN A POLICY? Coverage- Covers physical damage to the insured's automobile resulting from contact with another inanimate object. PIP- (Personal Injury Protection) -Pays basic expenses for an insured and his or her family in states with no-fault auto insurance. No-fault laws generally require drivers to carry both liability insurance and personal injury protection coverage to pay for basic needs of the insured, such as medical expenses, in the event of an accident. 4

Important Terms Liability- Insurance that pays for the other drivers loss, due to negligence imposed by you. Collision- Covers physical damage that you cause to your automobile resulting from your negligence. Very Expensive. Consider Dropping? 5

Definitions Comprehensive- Auto insurance coverage providing protection in the event of physical damage (other than collision) or theft of the insured car. For example, fire damage or a cracked windshield would be covered under the comprehensive section. Uninsured/Underinsured- Endorsement to a personal automobile policy that covers an insured collision with a driver who does not have liability insurance. Optional 6

Common Insurance Terms Deductible- Amount of loss that the insured pays before the insurance kicks in. Claim- A demand made by the you for payment of the benefits as provided by the policy. Only cover market value of you vehicle. Tier Rating- Determines Rates Lapse in Coverage- Insurance ID Card- 7

NJ Insurance Minimum Bodily Injury Liability- Coverage for claims and lawsuits by people injured as a result of an auto accident you cause $ 15,000 per person, $30,000 max for all injures in one accident. Property Damage Liability- Coverage for claims and lawsuits by people whose property is damaged as a result of an auto accident you cause $ 5,000 Personal Injury Protection- Coverage for injuries sustained in an automobile accident by you or other persons covered under your policy 10

Why do insurers charge young males more then young females? Rates are based on statistics Generally, males tend to have a slightly higher rate of collisions and violations. Generally, insurance companies will cover the cost of your vehicle if your friend is driving and is in a collision. 12

When do parents have to add you to their insurance policy? When you receive your permit Will my parents auto policy cover me when I’m away at college? Yes, as long as you do not change the address on your license. 15

What to do when you’re in an accident. Stop- Remain at the scene Call the Police Obtain Insurance Information Log accident information Report accident to insurance company Get copy of police report 16

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