Auto insurance covers you from losses incurred regarding automobile usage and safeguards your financial security in the event of an accident. You can buy different coverages depending on what you want. This contract is between the insurance company and you. Coverage will protect you regarding liability in the event of bodily injury, property damage, and medical payments, and also physical damage coverages of collision and comprehensive. The insurance company will agree to pay for losses decided on in your policy in exchange for your premium payment.
Coverage of various types will pay for various kinds of damage caused. Property insurance covers any damage or theft done to your car, liability insurance covers you legally if you harm others or their property, and medical insurance covers treatment for injuries, rehabilitation, lost wages and funeral expenses. These will be described in more detail later.
Each auto insurance policy has six different types of coverage. Many states require you to carry some, but not every kind of coverage. If you have used financing to buy your car, your lender might have some stipulations.
These are the different coverages that you can get in a basic auto policy. All of the different coverages are priced individually.
Bodily Injury Liability
Any injuries that you or the person you designate as a driver cause to another is paid for by this type of coverage. When driving another’s car with their permission, you and any family members listed on the policy are covered.
Personal Injury Protection (PIP)
Medical Payments, also known as Personal Injury Protection (PIP) will cover hospital bills and other treatment costs for anyone in the car of the policyholder. Medical payments, wages lost and costs for replacing services usually done by someone hurt in the auto accident can be covered by PIP. Funeral costs may also be covered.
Property Damage Liability
Third is property damage liability. Should you, or someone else driving your car, cause damage to another’s property, this coverage will pay for it. While this covers damages to others’ autos, it also covers damages to lampposts, telephone poles, fences, buildings or any structures you strike with your auto.
Collision
The fourth type is Collision. Any damages to your auto from collision with other cars, objects or from flipping over are covered by this type of insurance. In addition, damage caused by potholes is also covered. Usually, collision coverage has a deductible of between $250 and $1000.