Does the car insurance cowl flood injury? – Forbes advisor – Forbes

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Best car insurances 2021

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If you have comprehensive car insurance, flood damage to your car is covered. Fully comprehensive insurance pays for repairs or pays the actual cash value of the car at the time of the flood if the car is total loss.

Floods are more common than you might think. Therefore, it is wise to know what to do if your car is hit by a flood and what role insurance will play afterwards.

Comprehensive insurance claims have a deductible

Fully comprehensive insurance covers flood damage to your car as well as other problems such as car fire, vandalism, hail damage and car theft.

A claim to fully comprehensive insurance has a deductible. A deductible is the amount that is deducted from your insurance performance review. For example, if you have a $ 500 deductible, your insurance company will write a check for the flood repairs for your car minus the $ 500 deductible.

Not sure what deductible you have for your fully comprehensive insurance? Check the declaration page of your insurance policy.

The average cost of fully comprehensive auto insurance is around $ 168 per year, according to the National Association of Insurance Commissioners.

Collision protection with comprehensive insurance coverage

If you have fully comprehensive insurance, there is a good chance that you have collision insurance as well. These two types of car insurance are often grouped together by car insurance companies and work together to cover repairs to your car. They add to your liability insurance, which is required to drive legally in almost all states, and only covers injuries you cause to others and damage to their property.

Accident insurance pays for damage to your car if your car hits something or another car, regardless of who caused the accident. The average cost of accident insurance is about $ 378 per year, according to the National Association of Insurance Commissioners.

If you are financing or leasing your car, your car rental company or leasing company will likely require that you have both fully comprehensive and collision insurance. When you pay off the car loan, you can decide whether you want to continue this coverage or whether it is time to abolish the full and collision insurance.

Other types of auto insurance

Here are three more types of important coverage for vehicles.

Liability insurance is required in most states and is usually the most expensive part of auto insurance. Liability insurance pays if you are responsible for a car accident and injure others or damage someone else's property. Liability insurance also covers legal costs if you are sued for a car accident.

Rent Refund is also referred to as transport cost coverage. This cover covers the reimbursement of rental cars and public transport costs if your car is in the workshop due to an insured event. The rent refund is not associated with a deductible. It is optional and can be added to a policy at an additional cost.

Gap insurance is coverage that covers the difference between what you owe on your loan and the value of your damaged or stolen vehicle. For example, if your car was totaled in a flood, Gap Insurance pays the difference between the real cash value of the car and what you owe for the car or the lease amount. Let's say you have a loan of $ 25,000 and your car is worth $ 22,000. If this car is totaled, you still owe $ 3,000 to your lender. Gap insurance pays that $ 3,000 so you don't have to.

Liability insurance can also be obtained if your car is stolen and not recovered.

To qualify for gap insurance, you must first take out fully comprehensive and collision insurance for your car.

Beware of flooded cars for sale

Cars damaged by floods often come onto the market. According to Carfax, there were 446,836 flood-damaged cars on U.S. roads in 2020.

When an insurance company adds up a vehicle after a flood damage, it issues a salvage title. That means the car cannot be driven until it is repaired, passed an inspection, and is renamed. The new title indicates that the vehicle was severely damaged and has been overhauled.

Cars with a salvage title are usually sold at auctions to scrapyards for parts or to dealers who will rebuild them, but can also be sold to private buyers if the title shows there has been flood damage.

State regulations and laws regarding titles vary, with some states being more lenient than others in their definition of salvage title cars. That means that sometimes flooded cars are renamed over the course of multiple sales, often across state lines, ending with a title that doesn't reveal the damage.

Flooded cars are also cleaned and sold in the private market by unscrupulous owners who do not tell unsuspecting buyers about the damage.

Vehicles with flood damage can rot from the inside, sometimes gradually, and have mechanical, electrical and safety systems that can fail at any time, so obviously you will want to forego the purchase. That means staying away from cars with salvage or converted titles.

But how do you know if a car has been flooded? A musty smell, damp or mismatched carpets, rust on the doors and pedals and in the hood, and mud under the seats are all signs that you are looking at a flooded car.

It is advisable to check the vehicle history report through a company like Carfax or use the National Insurance Crime Bureau's free VINCheck, which shows a car's history when you enter its vehicle identification number. Another source for researching the history of a vehicle is the National Motor Vehicle Title Information System website.

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