Guide to Florida Car Insurance

Auto policies are one of the most popular types of Florida insurance. Learn the basics of car insurance here.

What Is Florida Car Insurance?

Florida car insurance protects you from monetary losses in the event you have a collision. In essence, auto insurance is a contract between you and your insurer. You agree to pay your Florida insurance premiums as specified in your policy, and, in return, your insurer agrees to reimburse you for losses according to the specifications of your coverage. A basic Florida car insurance policy has three components:

• Property damage. This coverage usually has two smaller components: collision and comprehensive. These coverages will reimburse you for damages to your vehicle caused by collisions or other accidents.
• Liability coverage. Again, this coverage has two smaller components: bodily injury and property damage. This will protect you from lawsuit judgments in the event you are sued over injuries or damages you caused another party in an accident.
• Medical coverage. This coverage is not necessary if you have a good health insurance plan. It will pay for reasonable and necessary medical expenses for you and your passengers in a collision.

Insuring a Leased Vehicle

If you lease a vehicle, you still need to buy Florida insurance for it. Your car dealer or bank will require that you purchase comprehensive and collision coverage for the vehicle, and you will also have to purchase sufficient liability coverage to comply with Florida’s state laws. The collision coverage will pay for damages sustained during an accident with another vehicle or object. Comprehensive coverage pays for damages not sustained in a collision, such as theft, vandalism, or fire.

Drivers who lease their vehicles may also be required to purchase Florida gap insurance. Gap insurance covers you in the event that your leased vehicle is totaled beyond repair. If this happens, the check the insurance company gives you to cover the damages is likely to be significantly less than what you owe to your bank or car dealership. This is because the insurance check is based on the car’s actual cash value, which accounts for depreciation, whereas the car dealership values the car based on what they originally paid for it.