If you’re in a car accident and another driver is at fault, their insurance pays you the value of your totaled vehicle with property damage liability coverage of the at-fault driver. If the other driver does not have insurance, you can be protected by your insurance policy’s comprehensive insurance, collision insurance, or uninsured motorist property damage/underinsurance motorist property damage. It’s important to check your coverage under UMPD/UIMPD policies with your carrier to see what is the value of your coverage.
If you total your car, your insurer will send a payment to your car lender for the cash value of your car, minus your deductible. If someone else is at fault, send the information to the at-fault driver’s insurance company with your lender information.
If your insurance payment is not enough to pay off the car loan on a financed vehicle, gap insurance covers the difference on the amount owed to your car lender. Each carrier’s gap insurance coverage varies, so make sure you discuss with your carrier.
Keep in mind to immediately contact your insurance carrier if you’re ever involved in any sort of car accident.