Five surpising things car insurance doesn't cover
Car insurance can cover damage from accidents, vandalism and even meteor strikes. But no matter how good your聽聽is, it might not cover everything you think it does. And unexpected holes in coverage can cost you.
Here are a few of those gaps, along with tips for how to cover them.
1. Personal belongings in your car
聽covers your car if it鈥檚 stolen or vandalized, but not the items you leave inside. After a smash-and-grab break-in, for instance, comprehensive coverage would pay to repair your broken window 鈥� minus the deductible 鈥� but wouldn鈥檛 reimburse you for the contents of the shopping bags swiped from the back seat.
Your best bet is to prevent theft by always locking your car and putting any belongings, especially navigation systems and other valuables, in the trunk or out of site, the National Insurance Crime Bureau advises.
Coverage to fill the hole:聽Your homeowners or renters insurance will cover items stolen from your car, provided you file a police report. If the value of the items is less than your deductible, you鈥檒l have to pay the full cost of replacement.
2. People who live with you but aren鈥檛 listed on the policy
A standard car insurance policy generally covers you and other people who don鈥檛 live with you and who have permission to use your car occasionally. Members of your household must be listed on your car insurance policy to have coverage.
Coverage to fill the hole:聽Ask your insurance agent who has coverage when driving your vehicle. You鈥檒l likely need to list all members of your household who have driver鈥檚 licenses, including roommates, on your policy.
3. Your car loan, if your vehicle is totaled
Having collision and comprehensive insurance doesn鈥檛 necessarily mean you鈥檙e in the clear if you total a financed car. In that case, the insurance company will issue a check for the car鈥檚 market value, minus your deductible. Because of depreciation, the payout could be lower than the amount you owe on the car loan. This is most likely if you made a small down payment and have made three years or fewer of payments on the loan.
Coverage to fill the hole:聽聽pays the difference between your insurance claim check and the outstanding loan balance. You can buy a policy through your car insurance agent or an insurance company representative.
You might be required to have gap insurance if you lease a car. The car dealer usually provides the coverage, and the cost is included in your lease.
4. Custom parts and equipment
If your car is damaged or stolen, auto insurance won鈥檛 cover custom parts and equipment you added to the vehicle. That can include:
- Technology, such as stereo equipment, TVs, DVD players and in-vehicle communication systems.
- Custom seats, interiors.
- Aesthetic enhancements, such as custom rims, grilles, paint and spoilers.
- Performance enhancements, such as high-performance exhaust systems.
- Wheelchair lifts and other modifications to assist drivers and passengers with disabilities.
Coverage to fill the hole:聽Many insurers offer an optional customized parts and equipment policy.
5. Delivering pizzas and other business uses
Standard personal auto insurance covers your commute, but not business uses. Delivering products and transporting people for hire 鈥� driving for Uber, for example 鈥� are excluded under standard personal policies.
That means your insurer can decline to cover any damage you cause or receive while using your car for business. At worst, your policy might be canceled, even if you only use your car for business part of the time.
Coverage to fill the hole:聽If you use your car for work, ask your employer when and how much coverage you receive under the company鈥檚 policy. If your employer鈥檚 insurance doesn鈥檛 cover your car, or if you鈥檙e self-employed, ask your car insurance agent about commercial auto coverage.
Ride-sharing outfits such as Uber and Lyft provide drivers commercial coverage when they鈥檙e logged into the apps. Policies typically have higher liability limits while drivers are transporting customers and lower limits when they鈥檙e between passengers. In some states, you can buy聽.
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