Types of Auto Insurance Coverage

Just because you need to file an SR22 does not mean you cannot have decent auto insurance coverage.

To make an informed buying decision for your auto insurance, you need to fully understand coverage’s. If you are not familiar with auto insurance coverage’s or would like to refresh you knowledge, this article will help you better understand auto insurance coverage’s. Each state has different limits and laws. Check with your individual state if you need state specific information.

Liability Auto Insurance

Liability auto insurance pays for the property damage or physical injury to others caused by you. State minimum coverage is typically not enough coverage and varies by state. Available coverage limits vary by company. Consider how much you have to lose in a lawsuit and how much coverage you can afford and be sure to purchase an adequate amount of liability coverage to limit your exposure in the event of an accident.

Collision Insurance Coverage

Collision covers the repair costs to fix your vehicle after an accident when you are at fault. The deductible is the portion you are responsible for. Typical deductibles are $250, $500 and $1000. A higher deductible will result in a lower premium, and a lower deductible will result in a higher premium.

Comprehensive Insurance Coverage also known as other than collision (OTC)

Comprehensive insurance covers damage to your car, other than accidents including damage from theft, fire, vandalism, flooding, and hail. Deductible applies.

Rental and Towing Coverage

If you are carrying comprehensive and collision coverage, some companies offer rental and towing coverage. In the event of an accident, rental will pay for a rental car up to the limits you purchase. Different companies offer different amounts and typically range from $20 per day up to $40 per day and max out at 30 days. Towing cover’s vehicle disablement towing up to the limits which usually range from $50 up to $150.

Personal Injury Protection

Personal Injury Protection is like a small medical policy that covers everyone in the vehicle in the event of an accident and can cover additional expenses such as lost wages. PIP coverage is usually sold in increments of $2500, $5000, $10000.

Medical Coverage

Is like a small medical policy that covers medical expenses to everyone in the vehicle in the event of an accident, no additional expenses are covered.  PIP is usually preferred over Medical. You can carry PIP or medical coverage, but not both on a policy. Medical coverage is usually sold in increments of $2500, $5000, $10,000.

Uninsured or Underinsured Motorist Coverage

Uninsured or under-insured motorist coverage pays for costs related to injuries to you or your family members and guests riding in your car and/or property damage caused by an uninsured or under-insured driver in an accident. Limits offered are the same as the liability coverage on your policy.  Most companies will allow you to purchase less, but you cannot purchase higher limits than what you carry on your liability limits. Make sure you carry enough coverage; this is the coverage that protects you, your family and friends in the event of an accident with uninsured or under-insured. A deductible of $250 applies.

Some companies offer additional coverage’s such as roadside assistance, accident forgiveness and new car replacement to name a few. These are additional coverage’s and will increase your premiums. Use the coverage tips above to help make a good decision when you purchase you next auto insurance policy.