What does my car insurance cover?

4 auto coverages you probably don't know about

Most policyholders know the basics. Sure, car insurance pays for damage caused by an at-fault auto accident. But auto insurance is a complex instrument with a myriad of coverages and situations, often depending on what specific types of coverage a policyholder chooses.

Insurance companies often get questions like these:

• Does insurance cover hail damage?
• Does insurance cover hit-and-run?
• Do you need insurance to rent a car?
• Does car insurance cover other drivers?

To dispel some myths and questions, here are answers to these four scenarios.

Does car insurance cover hail damage?

Some car insurance policies will cover hail damage. Those with comprehensive auto policies are in luck. Comprehensive policies cover auto damage that doesn’t result from a collision or accident. Comprehensive insurance covers damage from events like hail, floods, theft and vandalism.

Hail damage is something to worry about. In 2015, there were 5,412 major hailstorms in the U.S., according to the Rocky Mountain Insurance Information Association (RMIIA), a nonprofit insurance communications organization representing insurers in several western states. Of all 723,743 hail insurance claims in the U.S. from all carriers between 2013-2015, personal automobile hail claims were second in number, with the most claims coming from personal property homeowners.

Cars can sustain several types of hail damage. The severity depends on the hailstone size and the car’s location during the hailstorm. Was the car out in the open? Partly covered in a carport? Hail can ding or dent up the car side panels, roof, trunk and hood. It can break windows and the windshield or even scratch the glass.

Unsuspecting drivers in a hailstorm can easily be caught unprotected. Given that hailstorms usually last only five or six minutes, those driving should attempt to quickly seek cover, if it’s possible and safe to do. Cover might be under an overpass, under a garage roof or inside a parking structure. If that’s not possible, the car’s driver and passengers should protect their heads and faces with clothing in case of shattering glass.

Those with comprehensive insurance coverage who sustain hail damage should file a claim quickly with their insurance provider to get the process started. Take photos of the damage and cover any broken windows to avoid damage inside the car. The insurance carrier sends the driver to a claims center for a damage assessment. For hailstorms that affect a lot of cars in one area, the insurance carrier might deploy a mobile claims team.

Hail damage can affect a car’s resale value. Usually the panel damage isn’t a functional problem but an aesthetic one. For smaller dents and dings, a body shop can sometimes pop out the dents without affecting the paint. For severe or extensive damage, they may recommend replacing car panels. The insurance company and repair shop can advise what’s needed on a case-by-case basis.

Fortunately, those with comprehensive insurance can breathe easily in a hailstorm. But keep in mind that deductibles still apply to the insurance company payouts. Policyholders will be happy to know that their rates won’t be affected by the claim, as it’s a natural event, not one caused by the driver. That said, if hailstorms are a common occurrence, customers should consider, as a general practice, storing cars in a garage or covered carport for protection, if possible.

Does insurance cover hit-and-run?

A hit-and-run accident is one where the driver leaves the scene without providing contact information. It could be a driving accident on a highway or hitting a parked car.

Several types of insurance might apply to a hit-and-run accident, including collision insurance, uninsured and underinsured motorist coverage, and liability insurance. Different states have different rules. Collision insurance might cover a policyholder’s parked car that’s damaged by someone else, if, say, another car side-swiped the insured car and pulled off the mirror or damaged the door.

While all states require drivers to have car liability insurance or a proof of financial responsibility (requirements vary depending on the state), that doesn’t mean all drivers actually have it or accept responsibility when they cause damage. In some states, uninsured motorist coverage is mandatory, while in others, insurers are required to offer the coverage, but a driver does not have to purchase it. Only a handful of states require drivers to purchase underinsured motorist coverage.

While it’s not ideal for policyholders to have to pay a premium for uninsured and underinsured motorist coverage to ensure payment for damage caused by someone else, it’s much better than having to pay out-of-pocket. These policies cover the driver and passengers’ bodily injury as well as car repair. They even cover pedestrians, if they’re hit by someone without adequate insurance.

The insurance company may require a police report, so it’s helpful to call the police right away. Collecting witness contact information and photographic evidence is also helpful.

Does car insurance cover other drivers?

Figuring out whether your insurance covers other drivers can be confusing, especially if the other drivers aren’t family members and they aren’t noted on the policy. Typically, though, an auto policy covers the car and its designated drivers. A designated driver is someone who is driving with the policyholder’s permission. In that case, they are usually covered for liability, including property damage and bodily injury. They would also be covered if driving the policyholder’s car and they’re hit by someone without necessary insurance coverage. That could trigger the uninsured or underinsured motorist coverage.

If a person is driving a policyholder’s car without their permission (for example, they’re stealing the car or taking it for a joyride), the driver is not covered by the car’s insurance policy. That means the car or people they hit aren’t the policyholder’s responsibility. The policyholder’s car, however, would likely still be covered.

If a car owner gives permission to someone to borrow his or her car and that person has an accident, it’s possible for the driver to still get their insurance company involved. That usually happens if the owner’s limits of liability are low or are exhausted paying the claim. The driver’s insurance might kick in for the remainder of the damages.

Some car insurance policies are for named drivers only, which means they cover only the specific people listed on the policy. A policyholder can also exclude certain drivers, which means if that driver uses their car, there wouldn’t be coverage in case of a claim by that driver. If you have a non-family member who is using the car frequently, like a babysitter or nanny, it’s wise to add them to the policy.

Do you need insurance to rent a car?

As anyone who has stood at a car rental counter has experienced, it’s important to know whether you need insurance to rent a car. These aren’t questions to ponder at the last minute, with the rental car agent ready to add additional daily charges to the rental.

Renters aren’t alone in their confusion. Some 42% pronounced themselves "thoroughly confused" about insurance coverage when renting a car, according to a survey cited by Lisa Burbank in USA Today.

In general, a personal auto insurance policy does extend to rental cars with the same limits of liability. That includes liability for property and auto damage and collision coverage for rental car damage. The comprehensive portion of the policy takes care of the rental car’s damage from non-driving damage, such as hail or theft. Of course, this all depends on the coverages the policyholder chose for the personal auto policy.

What may not be covered by this insurance is the rental car company’s loss of use and revenue it claims while the damaged car is being repaired, or a loss in that car’s value. Some renters prefer to get the rental car coverage for this reason, as well as to avoid making any claims on their personal auto coverage. Especially when traveling abroad, renters should specifically ask their insurance agents about any available coverage.

For more questions, contact your agent

With all of these types of potential damages and coverages, it’s helpful for policyholders to call their insurance agents to verify exactly what their policies cover and what damages trigger auto coverage. Insurance policies vary from company to company. Even within a single company, policyholder choices affect their individual coverage.

Ask an agent what additional coverages are available. It’s often much less expensive to add coverage than most consumers realize and over time the saving can be considerable.