There are four main types of auto insurance coverage. Understanding the protection that each of these types of insurance offers is an important part of being able to select an auto insurance policy that best fits your needs. Continue reading below to learn more about each of the four different types of coverage.
Liability Auto Insurance Coverage
Liability auto insurance coverage must be carried by all drivers. This type of insurance coverage is designed to cover any costs incurred by another driver if you were to cause an accident. In other words, this coverage will cover all personal liabilities that you may have if you hit another vehicle or damage someone else's personal property with your vehicle. This type of insurance provides coverage for both property damage and bodily injury costs.
Collision Auto Insurance Coverage
Collision insurance is often required when leasing or financing a vehicle. However, this type of coverage can also prove quite useful even if you own your vehicle outright. This is because collision insurance protects you against the cost of repairing your own vehicle if you cause an accident.
Comprehensive Auto Insurance Coverage
Comprehensive auto insurance coverage is also commonly required when leasing or financing a vehicle. This type of insurance is also designed to protect you against the costs of repairing your vehicle. The primary difference between collision and comprehensive coverage is that while collision coverage protects you in the event you cause an accident, comprehensive coverage protects you if your vehicle is damaged in another way. For instance, if your vehicle is damaged as a result of extreme weather, it is comprehensive auto insurance that will protect you in this situation.
Uninsured/Underinsured Motorist Auto Insurance Coverage
In a perfect world, all drivers would have adequate insurance policies. Unfortunately, this is not a perfect world, and there are some drivers on the road who either do not have any insurance coverage or who do not carry enough insurance to fully cover the cost of your vehicle. If you are involved in an accident with one of these drivers, you could find yourself paying for damage to your vehicle out of your own pocket. This type of auto insurance coverage protects you in this situation by allowing you to file a claim with your own insurance if you are ever hit by a driver who doe not have the proper coverage. This type of coverage can also help to pay for any medical bills you may incur as a result of your accident.
Share2 August 2022
I still remember the first time I had to chose an insurance policy; I was 17 years old and had just saved up enough money to afford my very first car. I was so excited to begin driving, but overwhelmed with all of the different auto insurance options. My father helped me chose a full-coverage policy that would cover the cost of my car if it were to become damaged in an accident. When I inevitably caused a small fender-bender as a new driver, my insurance company paid for my car repairs, so it sure was the best policy for me! Now that I am older and have learned a lot about home insurance and other types of insurance, I thought I would make a blog to help others who need insurance advice, like what my dad gave me. I hope I can help you make wise insurance decisions!