How Natural Disasters Affect Auto Insurance Coverage

Many factors can affect auto insurance, some of which may be beyond your control. However, understanding these processes and influences may at least help you be prepared for potential challenges and budgetary adjustments. While natural disasters can come in various forms, they can typically be covered by an appropriate auto insurance policy. However, even if you’re issued a payout, these events may have long-term ramifications for your coverage.

What Type of Insurance Covers Natural Disasters?

When insuring automobiles, such as cars, trucks, vans and recreational vehicles, you’ll typically need comprehensive coverage to address natural disasters. Comprehensive coverage can encompass a broad range of losses and incidents, including fires, theft, vandalism, weather-related damage and natural disasters.

How Does Comprehensive Coverage Work?

Like many facets of auto insurance and other policies, comprehensive coverage includes limits and deductibles. After a covered incident, such as a hurricane, flood, earthquake or tornado, you can submit a claim against your policy. If approved, your insurance carrier can issue financial aid to help you repair, restore or replace your damaged vehicle. This payout can be up to the limits listed in your policy and minus your deductible, which is a minimum out-of-pocket amount you contribute toward covered losses. Comprehensive coverage is not typically required by law, but many auto lenders may mandate it to protect their interests.

How Do Natural Disasters Affect Auto Insurance Rates?

Although comprehensive coverage may financially protect you and your vehicle from natural disasters, carriers must account for a changing world and subsequent events. Natural disaster-related losses have been on the rise in many parts of the country in recent years. Raging wildfires and powerful tropical storms have imposed extensive property losses and claims costs. In response, auto insurers may need to increase auto insurance premiums. If you’ve recently experienced a natural disaster in your area, you might observe rising costs even if you did not need to submit an auto insurance claim.

We’re Here to Help

Contact Hathaway Agency, Inc in Bronson, MI, today to learn more about auto insurance, comprehensive coverage and other information related to natural disasters.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.