What does a Nationwide umbrella policy cover?

Nationwide determines that a vehicle is a total loss when it cannot be safely repaired or the cost of repairs exceeds the car’s actual cash value (ACV), which is what the vehicle was worth prior to being damaged. Nationwide may also total a car if the cost of repairs exceeds a certain percentage of the ACV, depending on state law.… read full answer

How Nationwide Adjusters Calculate Actual Cash Value

After a vehicle is damaged and the policyholder files a property damage claim, an insurance adjuster will try to determine the car’s actual cash value. To do this, they will consider several factors, including:

• Make and model
• Year
• Mileage
• Depreciation
• Accident history
• Mechanical problems
• Wear and tear
• Cosmetic problems
• Local demand for similar vehicles
• Sale price of comparable vehicles

Once the adjuster knows the ACV, they will compare it to the estimated cost of repairing the vehicle.

How Nationwide Determines Total Loss

In 28 states and the District of Columbia, there is an established total loss threshold (TLT), which means that if the cost of repairs is more than a certain percentage of the car’s actual cash value, Nationwide must total it. For example, Alabama has a TLT of 75%.

In the remaining 22 states, Nationwide and other insurers will use the standard total loss formula to decide whether or not to total a vehicle.

Finally, it may be impossible to safely repair the vehicle in order to make it roadworthy again. In this case, Nationwide will declare the car a total loss regardless of the actual cash value.

Umbrella insurance covers injuries, property damage, certain lawsuits, and personal liability situations that exceed your home and auto liability coverage. An umbrella policy extends your liability insurance limits and offers protection for situations not covered by a standard liability policy, such as libel or slander.

On the other hand, umbrella insurance does … read full answernot cover claims that are excluded outright from liability insurance, such as intentional damage or damage to your own property.

What Umbrella Insurance Covers

• Liability in excess of auto/home insurance policy limits
• Libel and slander
• Malicious prosecution
• Psychological harm and mental anguish
• Legal defense costs related to liability claims
• Liabilities when traveling overseas
• False arrest

Umbrella insurance is typically recommended for individuals who have a high net-worth that can’t be covered by a standard liability policy. To learn more, check out WalletHub’s guide to umbrella insurance.

You need enough liability insurance to cover your net worth. Having coverage equal to the value of the assets you own and all the money you have, minus your debt, protects you financially in case of a serious car accident.

When to Carry Only the Minimum Liability Coverage

Although almost every state requires drivers to carry liability insurance, the minimum coverage is not always enough to cover the cost of an accident. It’s always best to carry as much liability coverage as you can afford, especially if you have a high net worth. You can generally get away with a lower property damage liability limit if you want to save, however, since property damage liability claims are usually less expensive than bodily injury liability claims.… read full answer

If you don’t have many assets or think the risk is worth it, you might be comfortable with carrying only the minimum coverage. But no matter what, make sure you’re carrying enough insurance to comply with state law and avoid paying fines for driving uninsured.

Liability Limits on Auto Insurance

Liability limits on auto insurance are the maximum amount that your insurance company will pay for injuries and property damage in accidents that you cause. Liability limits are typically written as three numbers divided by slashes.

For example, Arizona’s liability coverage requirements are 50/30/10. That means drivers need to carry $50,000 in bodily injury liability coverage per person, $30,000 in bodily injury liability coverage per accident, and $10,000 in property damage liability coverage overall.

Why You Need More Liability Insurance Than the State Minimum

Your insurance company will never pay for anything beyond the limits of your policy. Using the Arizona example, if you cause an accident that leads to $70,000 in medical bills for the other driver, you will have to pay for $40,000 if you are only carrying the minimum insurance required. And if you can’t afford to pay the full amount, the other driver can sue, and you can have your assets seized or wages garnished to cover the remainder.