Auto Insurance: Types of Coverage You Need to Understand

In the US we depend heavily on our cars for commuting to work, shopping, Taking children to school and their many activities and for the occasional vacation. Not only do we need to be concerned about our physical safety, we need to insure our financial safety against possible accidents or other incidents. Auto insurance coverage is required in all states with certain minimums. You need to look not only at the minimum requirements, but at what specific coverage and amounts you, your family and vehicle require for your financial well being.

The various categories of coverage include: bodily injury and liability, comprehensive, collision, liability, medical, coverage, personal injury protection and uninsured and underinsured motorists.

Liability Coverage:

Liability car insurance coverage is essential to have as a driver. This insurance covers injuries or damages to property that may occur during an accident. There are two types of liability policies: bodily injury liability coverage and property damage liability coverage. Liability insurance and property damage is mandatory in the US with each state having their own mandated minimums. It's important to know, however, that the minimum required liability insurance is seldom enough to cover damages in a typical accident, let alone a serious accident.

Medical Coverage:

Medical insurance focuses on the driver and passengers of the car. This policy will cover necessary medical treatment for the driver and the passengers. In addition, the medical insurance policy may or may not cover disability insurance and pain and suffering compensation.

Uninsured or Underinsured Motorist Coverage:

Uninsured motorist coverage provides protection for you and your passengers if you are involved in a accident with an uninsured driver or a hit-and-run accident. It is a substitute for the uninsured driver's policy and your claim is settled with your own insurance provider. In some states, uninsured and underinsured motorist bodily injury are packaged together into a single policy and may be mandatory. This type of auto insurance coverage pays for your medical expenses, lost earnings, and other damages when you or your passengers are injured in an accident caused by a driver inadequate or no insurance coverage. This type of policy also pays for injuries sustained in hit and run accidents. The amount covered by an uninsured or underinsured motorist bodily injury policy is limited to the amount you chose to purchase.

Collision Coverage:

Collision insurance covers the with the expense of repairing the damage to your car in an accident. A comprehensive policy will cover more such as damage caused by vandalism, weather, natural disasters, theft, etc. If you have an older car, this is one area where you can afford to carry lower limits.

There are some other types of auto insurance policies. These can include glass replacement, towing, car rental, etc. These types of insurance are typically not required and their premiums must be compared carefully to the benefits received.

Now that you are aware of the types of car insurance coverage available, the next step is to find a reputable insurance provider. The Internet is a great place to research auto insurance policies and rates. Check with several providers for quotes and policy information to find the best auto insurance for your situation.