Consumers are confused by what auto insurance covers

Table of Contents If someone else crashes into you and they are injured but they…

If someone else crashes into you and they are injured but they don’t have car insurance, what type of car insurance would pay for their medical bills?

Drivers that got this question wrong: 85%

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Answer: None of the above (options were liability, collision, comprehensive and uninsured motorist coverages).

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If you cause an accident, what type of car insurance would pay for the other driver’s vehicle damage?

Drivers that got this question wrong: 62%

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Answer: Liability coverage.

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If you accidentally crashed into a neighbor’s fence, what type of auto insurance would pay for the fence?

Drivers that got this question wrong: 60%

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Answer: Liability coverage.

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If a tree crushed your car roof, what type of auto insurance would pay?

Drivers that got this question wrong: 59%

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Answer: Comprehensive coverage.

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If you backed into a pole, what type of car insurance would pay for your car damage?

Drivers that got this question wrong: 57%

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Answer: Collision coverage.

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If your car is damaged by a flood, what type of auto insurance would pay for the damage?

Drivers that got this question wrong: 56%

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Answer: Comprehensive coverage.

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While not every state has the same requirements, each does mandate that drivers carry some form of auto insurance. Although it is ubiquitous, research from Forbes Advisor indicates insureds are confused by their policies as around 40% believe they have coverage that doesn’t exist in auto policies.

For example, 47% of drivers think coverage for additional living expenses is included in an auto policy, while 49% believe their policy has “extended crash coverage,” which isn’t a coverage type. Around 40% think they have “vehicle emissions” insurance.

Younger drivers, ages 18-25, are more likely to be misguided on what their auto policy covers. More than 65% believe they have vehicle emissions, while 69% said their policy covers additional living expenses. Further, nearly three-quarters said they have accidental death and dismemberment insurance in their auto insurance policy. Nearly all (91%) of young drivers surveyed also said insurance would pay out if their car wouldn’t start.

Not only do policyholders think they have coverage for things they don’t, a lot of drivers also believe they aren’t covered for fairly common situations. For example, 60% of drivers didn’t think auto liability insurance would pay for repairs if they crashed into a neighbor’s fence.

The biggest misconceptions were around uninsured motorist coverage, with just 3% of drivers knowing that none standard insurance types listed would cover the medical bills of an uninsured motorist if they crashed into another vehicle.

The above slideshow highlights consumers’ responses to questions about auto policies, according to Forbes Advisor. The questions were multiple choice, with respondents being given the choice between liability, collision, comprehensive and uninsured motorist coverages.

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