TX Texas Auto Insurance Question
Reader’s Question:
I have an auto insurance in Texas. I’m a little confused about the difference between the collision coverage provision and the liability provision in my auto insurance policy. Can you clarify?
Agnes
Abilene, TX
Howdy Agnes,
I tell you, you’re not alone, Agnes. Your auto policy has a rider that expressly protects your vehicle. That is called collision coverage. With this rider, the cost of repairs to your vehicle will be covered by your auto policy. Sometimes you need to understand that replacement is necessary. Most auto insurance in Texas establish an Actual Cash Value as the criteria for determining the replacement value of the vehicle. This ACV does not take into account what you might have paid for the vehicle. It is based on condition, depreciation and mileage. This value is generally set at the time of accident and after an inspection. Your auto policy should clearly spell out this procedure.
The liability coverage in your auto policy protects you in accidents where you are at fault. Liability pays for damages, injuries and expenses to other people, their autos and other property. You should learn to be familiar with this feature. This provision covers your own passengers. This is a central reason to purchase an auto policy.
Your agent will clarify any further questions you may have, but the collision and liability coverage in your auto policy definitely protect you against the unexpected. Happy motoring!