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What Is Property Damage Coverage?

Article Details
  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 19 April 2018
  • Copyright Protected:
    2003-2018
    Conjecture Corporation
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Property damage coverage is a type of provision within an insurance policy that helps to cover the cost of repairs for damages sustained by the property of others as the result of the occurrence of a covered event. For example, this type of coverage is often included in car insurance policies and can help to pay for the costs or repair to any property that is damaged as the result of the negligence of the operator of the insured vehicle. This means that if the operator should lose control of the vehicle and run into a business or a private residence, the driver’s insurance will help to cover the expenses of making repairs to the structure.

As with most provisions within an insurance policy, property damage coverage usually comes with some type of limit. This means that the insurance provider will honor a claim for up to a certain amount of damage to any property that resulted from the actions of the insured party. The scope of the coverage may also include assisting with any legal costs involved, should the insured party be sued as the result of those damages. In any event, the total amount of the coverage for both repairs and for legal representation will not exceed the maximum amount stated in the terms and conditions of the policy.

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Just about every type of car insurance plan will have provisions for at least some property damage coverage. This is very important, since the coverage can come handy with minor accidents, such as running into a street light or causing some damage to the landscaping on a neighbor’s yard. More importantly, the coverage can be extremely helpful in the event of some major malfunction of the vehicle that results in the loss of control of the car, causing damage to dwellings or other types of structures.

Property damage coverage should be part of the car insurance coverage for any vehicles that are owned and operated by businesses as well as by individuals. For example, freight lines that routinely operate a fleet of vans and trailer trucks to haul goods across the country will include this type of protection in the insurance policies. The amount of coverage will often vary, based on the type of goods that are hauled and the potential for accidents that could lead to damage to different types of property. Periodic assessment of the amount of property damage coverage provided by the policies is often a good idea, especially as shifts in the economy occur that could lead to higher repair and replacement costs exceeding the current scope of coverage.

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