It is very important to note that these terms are specific to the state of Oklahoma ONLY and will vary from state to state. InsuredOK.com offers these definitions for reference purposes only*.
Let’s break the coverage definitions down into three sections:
Section One: Coverage for the protection of others
Section Two: Coverage for your protection
Section Three: Other Coverages
Section Two: Coverage for your protection
Section Three: Other Coverages
Automobile Liability Insurance: Protection when others hold you legally responsible for bodily injury or damage to property losses incurred as the result of a vehicle accident. In other words, coverage in case you cause an accident where there is either physical or property damage to other people. This is a general term that covers bodily injury (BI) liability and property damage (PD) liability. You will see three numbers when you are buying liability coverage.
Here is an example of the Oklahoma state minimum† requirements in the three number view:
The first number represents (in the $ thousands) your liability limits for per-person bodily injury, or (BI).
25 = $25,000
The second number represents (in the $ thousands) bodily injury (BI) limits for all persons injured in any one accident.
50 = $50,000
The third number represents (in the $ thousands) property damage, or (PD) liability limits for all vehicles/property damaged in any one accident.
25 = $25,000
Oklahoma requires a mandatory minimum amount and insurance companies offer the option to purchase more. Keep in mind that the above liability insurance DOES NOT cover the person who causes the accident. It only protects the person’s liability for others who are involved in the accident.
Here is an example of why we do not recommend purchasing the state minimum amounts of liability coverage.
Josh is driving his older vehicle with the Oklahoma state minimum coverage of 25/50/25. His phone rings and he reaches down to get it, not knowing the vehicles in front of him have come to a complete stop. He crashes into Steve’s vehicle in front of him at a high rate of speed. Steve then crashes into Wendy’s vehicle in front of him and Wendy crashes into Elizabeth’s vehicle. Everyone sustains bodily injury and the four vehicles are completely destroyed. Josh’s minimum state liability coverage only pays for $25,000 of the property damage. The total amount of property damage is $70,000. Josh may be held legally liable for the difference between the coverage amount paid and the total amount. Josh may be sued for $45,000 ($70,000 - $25,000) or more depending on the amount of bodily injury caused by the accident. Neither Josh nor his vehicle are covered under the liability coverage, so Josh receives nothing for his injuries or vehicle.
Collision Coverage: Optional coverage for when your car is damaged as a result of colliding with another object—a brick wall, for example, or a rollover. It also can come into play if you hit a pothole that severely damages your car. This insurance applies only to your car. It doesn't cover whatever the car collided with (that's what your property damage (PD) liability is for). Collision coverage is also subject to a per occurrence deductible. Nationally, around 75% percent of insured drivers carry this coverage.
Comprehensive Coverage: Optional coverage for when your car is stolen or damaged in ways that don't involve a collision. Examples include: hail damage, fire, vandalism, damage from an animal, flood, earthquakes, falling objects and theft. The price of comprehensive insurance is affected by the risk of loss, meaning the likelihood that an insured car will be stolen or damaged, and the car's value at the time of the loss. Nationally, around 77% percent of insured drivers carry this coverage.
Deductible: This is your out-of-pocket expense that you agree to pay per occurrence for losses up to a set amount, such as $500 or $1,000. If you can afford to carry a higher deductible on collision and comprehensive coverage, you can substantially lower your costs. Deductible amounts can range from $50 to $2,500. You can choose what your deductible will be for both comprehensive and collision coverage.
Medical Payments (MP or Med Pay) Coverage: This optional coverage pays the doctor, hospital bills, and funeral expenses for injuries to you and the passengers in your car, regardless of who causes the accident, up to the policy limits. Most insurance companies offer a wide range of coverage amounts.
Uninsured/Underinsured Motorist (UM) Coverage: This optional coverage pays (up to the coverage limit) the insured person and other passengers in the vehicle when they're injured as the result of an accident where the at-fault driver is uninsured, underinsured or a hit-and-run. In Oklahoma, UM covers medical expenses, loss of wages and pain & suffering (up to the coverage limit), but does not cover damage caused to your vehicle/property. Therefore, if you’re concerned about protecting your vehicle from damage caused by uninsured/underinsured drivers, you should also purchase collision coverage.
Accident forgiveness: This optional coverage will protect you from a premium increase in the event you have an accident in which you are at fault. This coverage usually covers your first accident only that is incurred while you are insured with the company providing the optional coverage.
Additional Equipment coverage: A type of optional coverage that helps cover direct and accidental loss to custom equipment or features not installed by the vehicle manufacturer. A few examples are truck camper shells, custom stereo equipment, wheelchair equipment, customized wheels, & tonneau covers.
GAP Insurance: An optional coverage for newer cars that can be added to your collision insurance policy. It may pay the difference between the balance of a lease or loan due on a vehicle and what your insurance company pays if the car is considered a covered total loss. This is important especially if you owe more money on the vehicle than what is worth.
Glass Repair/Replace: An optional coverage that will repair or replace glass on a vehicle for a reduced deductible amount or no deductible at all.
Loss of Use: In relation to Auto Insurance, Loss of Use is an optional coverage that pays a specified dollar amount, usually $25 or $50 per day, to the insured for each day the vehicle is being repaired as the result of a covered loss, such as hail damage or an accident. Usually, there is a per occurrence limit to the total amount that will be paid out for a single covered loss.
New Car Replacement: An optional coverage for newer cars that will provide a brand new vehicle if the insured vehicle is considered a covered total loss. This coverage is typically provided on vehicles that are purchased brand new or are no more than one model year old. After a specified amount of time, the new car replacement option expires.
Rental Reimbursement: Optional coverage that provides reimbursement for a rental car that is used by the insured while their vehicle is being repaired for a covered loss. The rental reimbursement option can vary by company, with some limitations on the daily reimbursement amount, the total reimbursement amount for a single loss, and/or a combination of both.
Towing & Roadside coverage: Optional coverage that provides towing service in the event that the insured vehicle breaks down or cannot move using its own power. Coverage limitations, distance limits, and reimbursement amounts vary by company. Roadside service also varies by company, with some options, including but not limited to, locksmith services, flat tire repair, gasoline delivery, and/or battery jump services.
*InsuredOK.com offers the above definitions for reference purposes only. Specific coverage limitations and exclusions may apply depending on the insurance company that provides coverage. Discuss all coverages with your licensed agent and thoroughly review your insurance policy for a complete description of your coverages, limitations, & exclusions.
†(InsuredOK.com DOES NOT recommend purchasing minimum liability coverage amounts. They are specifically used for example purposes only.)
**This is not an all-inclusive list of other coverages available in the state of Oklahoma. InsuredOK.com recommends discussing other available options with your licensed agent.