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Understanding Property Damage Coverages

Property damage coverage protects drivers in the event they damage someone else’s property with their vehicle. In most cases it involves the other driver’s vehicle, but it also provides coverage if you were to have a collision with a home, fence, landscape, or other property. In most states property damage coverage is a mandatory part of a driver’s insurance policy. In California, drivers are required to have at least $5,000 minimum property damage coverage.

The coverage pays for repairs to property that was damaged by the covered driver. For instance, if you sideswipe a car in a parking lot and the other driver’s car needs repainting, the coverage will pay for the painting. However, if there is damage to the bumper that was caused in another collision in which you were not involved and the driver decides to have both repairs made simultaneously, your insurance coverage will not pay for the repairs to the bumper. Another advantage of property damage coverages insurance is protection in a lawsuit. Should you be sued by another driver, property damage coverage provides you with a legal defense regarding the damaged property.

Property damage coverage does not protect your vehicle. If damage is done to your vehicle through your own fault or the fault of another, your property damage coverage will not play a role. The other driver’s property damage coverage might come into play, as will your own comprehensive coverage.

It is unlikely you will have an option concerning property damage coverage when purchasing auto insurance, especially in states such as California that require the coverage by law. Should you find coverage that does not include property damage coverage and choose to purchase a policy without it, you can receive fines and penalties by not having the minimum requirements for coverage. You will also be held personally responsible for property damage should you be involved in an accident.

A more common mistake made with property damage coverage is choosing limits that are too low. If the damages caused by an accident that is your fault exceed your coverage limits, you can still be held responsible for the cost of the damages. Many insurance experts recommend drivers carry at least $50,000 worth of property damage coverage to ensure the coverage is adequate, should there be an accident. This raises your premium, but it is an important part of your protection. The challenge to choosing property damage coverages is not knowing the value of the property you could potentially damage. There is no way to tell if you will have a collision with an expensive car or an older, beat-up vehicle. It is better to be safe than sorry when it comes to property damage coverage.

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