Key Takeaways
- Part D has TWO coverages: Collision (damage from impact with another object) and Other Than Collision/Comprehensive (all other physical damage)
- COLLISION covers damage from hitting another vehicle, object, or overturning — regardless of fault
- OTHER THAN COLLISION (OTC) covers theft, fire, glass breakage, flood, hail, vandalism, and hitting animals
- Collision typically has a DEDUCTIBLE ($500-$1,000 common); OTC deductibles are often lower or zero for glass
- Hitting an animal (like a deer) is covered under OTC/Comprehensive, NOT Collision
Part D: Physical Damage Coverage
Part D protects YOUR vehicle from physical damage. Unlike Part A (which pays for damage you cause to others), Part D is first-party coverage for your own car.
The Two Parts of Part D
1. Collision Coverage
Definition: Covers damage to your vehicle from impact with another object or vehicle, or from overturn.
Covered Events:
- Hitting another vehicle
- Hitting a tree, guardrail, building
- Pothole damage
- Overturning (rollover)
- Backing into a pole
2. Other Than Collision (OTC) / Comprehensive
Definition: Covers damage from causes OTHER than collision.
Covered Events:
| Peril | Example |
|---|---|
| Theft | Car stolen |
| Fire | Engine fire |
| Glass breakage | Windshield crack |
| Flood | Water damage |
| Hail | Hail dents |
| Windstorm | Flying debris |
| Vandalism | Keyed car |
| Falling objects | Tree limb |
| Earthquake | Ground movement |
| Hitting an animal | Deer strike |
| Riot | Civil disturbance |
Exam Alert: Hitting an ANIMAL is covered under OTC/Comprehensive, NOT Collision. This is frequently tested!
Collision vs. Other Than Collision
| Feature | Collision | Other Than Collision |
|---|---|---|
| Impact with vehicle | YES | NO |
| Impact with object | YES | YES (falling) |
| Overturn | YES | NO |
| Theft | NO | YES |
| Fire | NO | YES |
| Hitting animal | NO | YES |
| Glass breakage | NO | YES |
| Flood | NO | YES |
How Part D Pays
Actual Cash Value (ACV)
Part D pays the lesser of:
- Actual Cash Value of the vehicle
- Cost to repair
ACV = Replacement Cost - Depreciation
Total Loss Determination
If repair cost ≥ ACV, the vehicle is a "total loss":
- Insurer pays ACV
- Insurer takes the vehicle (salvage)
Example: Partial Loss
| Damage | Value |
|---|---|
| Repair cost | $5,000 |
| Vehicle ACV | $15,000 |
| Deductible | $500 |
| Insurer pays | $4,500 |
Example: Total Loss
| Damage | Value |
|---|---|
| Repair cost | $12,000 |
| Vehicle ACV | $10,000 |
| Deductible | $500 |
| Insurer pays | $9,500 (ACV minus deductible) |
Deductibles
How Deductibles Work
You pay the deductible; insurer pays the rest.
Common Deductible Amounts
| Coverage | Common Deductibles |
|---|---|
| Collision | $500, $1,000, $2,500 |
| OTC | $0, $100, $250, $500 |
| Glass (OTC) | Often $0 |
Deductible Trade-off
| Deductible | Premium Impact |
|---|---|
| $250 | Higher premium |
| $500 | Moderate premium |
| $1,000 | Lower premium |
| $2,500 | Lowest premium |
Covered Vehicles Under Part D
| Vehicle | Coverage? |
|---|---|
| Vehicles on Declarations | YES |
| Newly acquired (same type) | YES (if existing coverage) |
| Temporary substitute | YES (if your car has coverage) |
| Non-owned vehicles | Usually NO |
| Rental cars | Check rental endorsement |
Part D Exclusions
| Exclusion | Reason |
|---|---|
| Wear and tear | Maintenance, not insurance |
| Mechanical breakdown | Warranty issue |
| Tires (unless stolen or damaged in covered event) | Maintenance |
| Electronic equipment (unless factory installed) | Separate coverage available |
| Custom equipment | Requires endorsement |
| Nuclear/radiation | Catastrophic exclusion |
| War | Catastrophic exclusion |
| Racing | High-risk activity |
Transportation Expenses
When your covered auto is stolen or being repaired after a covered loss:
| Coverage | What It Pays |
|---|---|
| Rental reimbursement | Daily rental costs |
| Transportation expenses | Up to $20-$50/day |
| Maximum period | Usually 30 days |
Note: Rental reimbursement may be included or require an endorsement.
Gap Coverage
Problem: You owe more than the car is worth.
| Situation | Value |
|---|---|
| Loan balance | $25,000 |
| Vehicle ACV | $20,000 |
| Gap | $5,000 |
Gap Coverage pays the difference between ACV and loan balance.
A driver hits a deer on the highway. This loss would be covered under:
A vehicle has an ACV of $15,000. Repair costs after a collision are $12,000. The deductible is $500. What does the insurer pay?
Which of the following is covered under Collision, NOT Other Than Collision?
5.6 PAP Exclusions
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