Key Takeaways
- Collision coverage pays for damage to your vehicle from collision regardless of fault
- Comprehensive coverage protects against non-collision losses including theft, weather, and animal strikes
- Medical payments coverage pays medical expenses for vehicle occupants regardless of fault
- Gap insurance covers the difference between vehicle value and loan balance if the car is totaled
- Nebraska drivers should consider higher liability limits due to inadequate minimums for serious accidents
Nebraska Auto Insurance Coverages
Physical Damage Coverages
Collision Coverage
Definition: Pays for damage to your vehicle from collision with another object or vehicle, regardless of who is at fault.
| Feature | Details |
|---|---|
| Trigger | Collision with object or vehicle |
| Payment Basis | ACV or stated value, minus deductible |
| Deductible | Typically $250 - $1,000 |
| Fault | Not relevant - covers your vehicle |
Covered Losses:
- Collision with another vehicle
- Collision with objects (trees, guardrails, etc.)
- Single-vehicle accidents
- Rollover accidents
- Potholes (may be collision or comprehensive)
Example Claim:
- Vehicle ACV: $25,000
- Damage: $8,000
- Deductible: $500
- Payment: $8,000 - $500 = $7,500
Comprehensive Coverage
Definition: Pays for damage to your vehicle from non-collision causes, including theft, weather, vandalism, and animal strikes.
| Feature | Details |
|---|---|
| Trigger | Non-collision losses |
| Payment Basis | ACV or stated value, minus deductible |
| Deductible | Typically $100 - $500 |
| Also Called | "Other Than Collision" (OTC) |
Covered Losses:
- Theft or attempted theft
- Vandalism
- Fire
- Weather damage (hail, wind, flood)
- Falling objects
- Animal strikes (deer very common in Nebraska)
- Glass breakage
- Riot and civil commotion
Exam Tip: Animal strikes (especially deer) are covered under comprehensive, NOT collision coverage. Nebraska has significant deer-vehicle collision exposure.
Nebraska Weather and Comprehensive Claims
Nebraska's severe weather makes comprehensive coverage valuable:
| Weather Event | Comprehensive Coverage |
|---|---|
| Hail damage | Covered |
| Tornado damage | Covered |
| Wind-blown debris | Covered |
| Flood damage | Covered (unlike homeowners) |
| Lightning | Covered |
Important: Auto comprehensive DOES cover flood damage, unlike homeowners policies which exclude flood.
Medical and Injury Coverages
Medical Payments (Med Pay)
Definition: Pays medical expenses for you and passengers injured in an auto accident, regardless of fault.
| Feature | Details |
|---|---|
| Limits | Typically $1,000 - $100,000 |
| Fault | Not relevant - pays regardless |
| Coverage | Named insured, family, passengers |
| Duplicate | May duplicate health insurance |
Covered Expenses:
- Hospital bills
- Doctor fees
- Surgery
- X-rays and diagnostics
- Ambulance
- Dental work (injury-related)
Personal Injury Protection (PIP)
Some Nebraska policies offer PIP coverage which includes:
- Medical expenses
- Lost wages
- Essential services
- Funeral expenses
Nebraska Note: PIP is not mandatory in Nebraska but may be available. Med Pay is more common.
Uninsured Motorist Bodily Injury (UMBI)
Required Coverage (unless waived in writing)
Pays when you're injured by:
- Uninsured driver at fault
- Hit-and-run driver
- Driver whose insurer is insolvent
| Feature | Details |
|---|---|
| Required | Yes, unless written waiver |
| Limits | Must be offered at liability limits |
| Lower Limits | May select lower amounts |
| Coverage | Named insured, family, passengers |
Underinsured Motorist Bodily Injury (UIM)
Optional Coverage (recommended)
Pays when at-fault driver's limits are insufficient:
- Your damages exceed other driver's limits
- UIM covers the gap up to your UIM limits
Example:
- Your damages: $100,000
- At-fault driver's limits: $25,000
- Your UIM limits: $100,000
- At-fault pays: $25,000
- UIM pays: $75,000 (gap)
Uninsured Motorist Property Damage (UMPD)
Optional Coverage
Pays for vehicle damage when:
- Uninsured driver damages your vehicle
- Hit-and-run (may require contact)
Additional Auto Coverages
Rental Reimbursement
Pays for rental car while your vehicle is being repaired:
| Feature | Details |
|---|---|
| Daily Limit | $30 - $50 per day |
| Maximum | $900 - $1,500 per occurrence |
| Trigger | Covered claim under collision/comp |
Towing and Labor
Pays for emergency roadside assistance:
- Towing to repair facility
- Flat tire change
- Battery jump
- Lockout service
- Fuel delivery
Typical Limits: $50 - $150 per occurrence
Gap Insurance
Definition: Pays the difference between vehicle ACV and loan/lease balance if vehicle is totaled.
| Feature | Details |
|---|---|
| Purpose | Cover "negative equity" |
| When Needed | New vehicles, long loan terms |
| Payment | Difference between ACV and loan balance |
Example:
- Vehicle ACV (total loss): $20,000
- Loan balance: $28,000
- Gap coverage pays: $8,000 difference
New Car Replacement
Pays to replace totaled new vehicle with new vehicle of same make/model:
- Usually available for vehicles under 1-2 years old
- Pays full replacement cost, not ACV
- Valuable for rapid depreciation
Original Equipment Manufacturer (OEM) Parts
Guarantees repairs use OEM parts instead of aftermarket:
- Maintains vehicle value
- Ensures manufacturer specifications
- Higher cost but quality assured
Auto Insurance Deductibles
Choosing Deductibles
| Deductible | Monthly Savings | Out-of-Pocket Risk |
|---|---|---|
| $250 | Lowest | $250 per claim |
| $500 | Moderate | $500 per claim |
| $1,000 | Higher | $1,000 per claim |
| $2,000 | Highest | $2,000 per claim |
Deductible Strategies
| Strategy | Best For |
|---|---|
| Lower deductible | Frequent claims, limited savings |
| Higher deductible | Good driver, emergency fund available |
| Different by coverage | Higher collision, lower comp |
Exam Tip: Higher deductibles reduce premiums but increase out-of-pocket costs for claims. Advise clients to choose deductibles they can afford to pay.
Nebraska-Specific Considerations
Deer Strike Coverage
Nebraska has high deer-vehicle collision rates:
- Covered under comprehensive (not collision)
- No deductible increase for deer strikes at most insurers
- Peak season: October - December
Winter Driving Coverage
Nebraska winter weather considerations:
- Ice and snow damage (single-vehicle) = collision
- Sliding into another vehicle = collision
- Weather damage to parked car = comprehensive
Farm Vehicle Coverage
Nebraska agricultural vehicles may need:
- Farm vehicle endorsements
- Unlicensed vehicle coverage
- Equipment floaters
- Hired/non-owned auto
Commercial Auto Considerations
Nebraska businesses should consider:
- Commercial auto for business vehicles
- Hired and non-owned auto liability
- Drive other car coverage for executives
- MCS-90 endorsement for interstate trucking
Under which auto coverage is damage from striking a deer covered?
What does Gap insurance cover?
Does auto comprehensive coverage include flood damage in Nebraska?