Let’s Talk About Auto Insurance

The younger generation has no patience with us Gen Xs! Or maybe it is just my daughters. I will admit, I am a little technologically challenged. Before I ask them to show me something on the computer or my phone, I have to mentally prepare myself for the sigh and eye roll that always seems to precede the answer to my question.

Guess what Gen Zs? There are actually some things we older folks know that you don’t know. For example, we know a thing or two about auto insurance! Yup, auto insurance!

This article on auto insurance is payback. On behalf of all of the parents of Gen Zs that have to suffer through the sigh and eye roll just to get a little help I am going to share some of our unique knowledge with the Gen Zs! And, I am not even going to sigh and roll my eyes while sharing this information.

In order to avoid any generational communication barriers, I have asked my millennial colleague, Attorney Takiya Lewis, to co-write this with me. 🙂

AUTOMOBILE LIABILITY INSURANCE. One of the MANY BILLS your parents PAY FOR YOU unbeknownst to you. The first time most of you become aware that your parents are paying this bill on your behalf is when you graduate from college and land your first job. Because it is then that your parents inform you that they will no longer be paying this bill.

To legally drive around in the vehicle your parents gave you, many states require you to have automobile liability insurance. Why? Simply put, if you cause an accident, the insurance company will pay for the damage you caused but, more than likely, cannot afford to pay.

As you begin to navigate the terrain of taking care of your own automobile liability insurance there are some key terms you should know:

BI (Bodily Injury): Part of your liability insurance is set aside to pay those that have been physically injured if you cause an accident.

PD (Property Damage): Part of your liability insurance is set aside to pay for property that you damage if you cause an accident.

UIM (Underinsured Motorist Insurance)
Scenario: Another Gen Z driver is texting and driving and smashes into your car as you’re headed to Starbucks to grab an iced coffee. You are seriously injured and unable to work for a while. The driver’s insurance company doesn’t dispute the fact that the driver was at fault and immediately hands over a check for your bodily injury. The problem is, the amount that the insurance company is going to hand over is not nearly enough to take care of all of the damage that has been done to you. This is where underinsured motorist insurance comes in handy! The term is self-explanatory, if the person that hits you doesn’t have enough insurance then your underinsured motorist insurance policy will kick in to help pay for all of the damage that was done.

UM (Uninsured Motorist Insurance): This comes in handy when that person that hit you because they were so busy texting has no insurance to compensate you for the damage they have caused.

Collision Coverage: This coverage pays for damage to your car from a crash that you cause to another driver, if you hit something or if you roll your vehicle. It also comes into play if another driver hits you but they don’t have insurance and you decided against uninsured/underinsured coverage. Of those reasons, the most important reason to have collision coverage is if another driver hits you and they don’t have enough coverage to pay for you to get a new vehicle if yours is totaled. In that case, collision coverage would kick in. So… it may be worth those extra dollars each month if the choice is between a new car and a 97 Honda.

Comprehensive Coverage: It helps you pay to replace or repair your car if it’s stolen or damaged in an incident that’s not an accident. Usually, that means fire, vandalism (i.e. your current boo’s ex keying your car), trees or other falling objects (like hail). Just in case you have someone unsure about boundaries and crimes, this would be a necessary coverage to have.

Deductible: I am ashamed to say, I learned about this the hard way. A deductible is what you have to pay out of pocket before the insurance company agrees to pay the rest. Whew chile, the ghetto. 🙂 So if the repairs to your car cost $3,000 and your deductible is $1,000, you have to pay $1,000 before the insurance company will pay the remaining balance. While it costs more to have a smaller deductible, you should really contemplate what kind of financial position you may be in if you have an accident. I know that an extra $15 may seem like a lot every month for a lower monthly insurance payment, but will you be in a position to pay $500 to $1,000 if something out of your control happens to your car?

Real talk, you cannot be empowered if you are not independent. And, you cannot be independent if you are not knowledgeable. Part of being an adult is making hard and responsible decisions. One of the most difficult decisions to make when you’re a young adult is about insurance. Hopefully this information helps you so you’re not caught out there looking crazy if the worst happens, asking us Gen Z’s or millennials for help.

Much love,

Tonza & Takiya

Author: Tonza D. Ruffin

Perfectly Imperfect but VERY PROUD WOMAN, MOM, LAWYER, and AUTHOR, but most importantly...LIFE LOVER! I laugh loud, I work hard, I play hard, I am adventurous, I am curious, I am driven, I have moments of deep insecurity, I am loving, I am vulnerable, I am explosive (not one of my finer qualities), I dance around my house alone, I am an awful perfectionist which makes my insecurity worse, I sing out loud in my car without any concern for whose watching, I have trust issues, I do not live through my children, I no longer try to force my children into the mold that I created so that I could feel validated as a mother, I am a risk-taker, I am guarded in my personal life, I am kind, I am grateful. I am so excited about the rest of my life!

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