Types of Auto Insurance Coverage |  |
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by: ccruiserboyy
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When it comes to auto insurance, you're not allowed on the road unless you carry at least the minimum requirements mandated by your state. In most cases, you'll find that the bare minimum requirements aren't going to meet your needs. In order to choose the best plan to suit your needs, it's a good idea to review the different types of auto insurance coverage.
Let's start with the basics. Nearly every state requires two kinds of auto insurance coverage: Property Damage Liability and Bodily Injury Liability. These are each designed to cover others who were caused damage by you. In most cases, they do not cover you, your passengers, or your car at all. Liability coverage adheres to limits, and although you can drive carrying the legal minimum of coverage, it is highly advisable that you upgrade your plan to the highest limit you can afford. Because liability deals with accidents where you are at fault, it is always a good idea to have the highest level of protection as a safety net. Even a small two-car accident can quickly result in damages that far exceed minimum liability limits, and this can land you in a lot of trouble and debt.
Property Damage Liability
Property Damage Liability involves situations where you are at fault for your car causing damage to the property of another. In most cases the "property" will be their car but it can extend to a garage, light post, fence, house, or anything damaged by your car. This means that if you cause an accident and damage another person's car, your Property Damage Liability Insurance will pay for the repairs. But it's important to remember the insurance will only pay up to a certain amount, depending on the limit of protection you've purchased. Once the limit is exceeded, you are responsible for all additional costs..
Bodily Injury Liability
Bodily Injury Liability covers the costs associated when you are responsible for another person's injury or even death. This can include things like medical bills but it can also extend to things like pain and suffering, or the injured person's loss of income. As a result, these costs can be extremely high which is why it is once again advisable to carry a plan with the highest limit you can afford. For example, if you are responsible for a serious accident, your liability limit should be a high enough to cover the costs of a potential lawsuit against you. If the lawsuit exceeds the limit, your personal assets could be seized to pay off the difference.
While Property Damage Liability and Bodily Injury Liability can help pay off damage you've caused to others, they do not cover any damage to your property or injuries suffered by you or passengers in your car. In order to protect yourself on these fronts, you'll need some different kinds of coverage.
Medical Payments Coverage
This pays the expenses resulting from you or your passengers sustaining injuries in an accident. It can also cover situations such as being struck and injured by a car while you are walking or riding a bike. In some cases, it can even cover injuries you suffer while riding in somebody else's car. As opposed to liability coverage, Medical Payments Coverage pays out no matter who is at fault.
Collision Coverage
Collision Coverage is the flipside to Property Damage Liability. It covers damage to your vehicle due to you hitting or being hit by another vehicle or in some cases, an object. This is one case where it is sometimes acceptable to keep your deductible high as you can determine how much you can afford to pay in an accident and go from there. Depending on the value of your car and your personal financial situation, this can be a great opportunity to keep your premium low without taking too great of a risk.
Uninsured Motorist Coverage
Just because you're being smart about auto insurance doesn't mean every motorist is doing the same. An at-fault uninsured motorist can put you in massive debt instantly by causing property damage or bodily injury to you or your passengers. Car repairs, hospital bills, and even loss of income are just some of the problems an uninsured driver can cause by crashing into your car. Even worse, a hit-and-run driver can cause an accident and disappear, leaving you in debt. Fortunately, you can protect yourself against this by purchasing Uninsured Motorist Coverage.
Uninsured Motorist Bodily Injury Coverage
This covers any personal injury or death that occurs as the result of an uninsured motorist being at-fault in accident. The coverage extends to you, your household members, and your passengers. Whether the person was a motorist with insufficient insurance or a hot and run driver, this will cover any medical bills and related costs.
Uninsured Motorist Property Damage Coverage
Uninsured Motorist Property Damage Coverage, similar to Uninsured Motorist Bodily Injury Coverage, pays for damages caused by an at-fault uninsured driver or hit-and-run driver, except it covers damage to your car and property as opposed to bodily injury. However, many states set a limit on the amount of coverage available for repairs to your damaged vehicle or property-in some cases keeping it under $4,000.
Comprehensive Coverage
Comprehensive Coverage deals with many potential damages not covered by the previous kinds of coverage. This includes damage your vehicle could sustain from vandalism. It might also include damages that occur if your vehicle strikes an animal, such as a deer. Harsh weather such as hail can also do damage that is covered under Comprehensive Coverage.
Other Types of Auto Insurance Coverage
While these are the basic kinds of auto coverage, you'll find that there are many more varieties that you can add to your policy according to your needs. These include such areas as towing and rental car costs, plus a great deal more. Just keep in mind when you're choosing auto insurance that a lot of your decision will come down to two things: What kind of premiums you can afford to pay, and what kind of protection you can't afford to be without.
About the Author
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