Basic auto insurance policies provide coverage in several areas. In most cases, liability, personal injury protection, property damage, collision, comprehensive and uninsured/underinsured motorist are available.
Injury Liability
Bodily injury liability applies to injuries that the policyholder causes to someone else. Liability is the most basic type of coverage, but it’s the most important. That is because you may be sued if you cause an accident. If you lose the case, then liability coverage will pay the damages.
Medical Payments
This coverage pays for treatment that you might need following an accident. It can cover medical costs and lost wages. It may also cover funeral costs.
Property Damage
This pays for damages caused to someone else’s property. It could mean damage done to a car or some other form of property. The damage must have occurred during an accident.
Collision
Collision pays for damage to your car caused during a collision. The collision must be with another car or an object such as a tree. Even if you’re at fault for the accident, your coverage will reimburse you for the costs of repairing your car. If the accident isn’t your fault, then your insurance company will recover the amount they paid from the other driver’s insurance. You may also get reimbursed for the deductible.
Comprehensive
This coverage reimburses you for damage caused by something other than a collision. That would include incidents such as fires and heavy winds. It also covers theft and vandalism. Comprehensive also pays for some repairs, such as a cracked or shattered windshield.
Uninsured and Underinsured Motorist Coverage
This coverage reimburses you if you’re hit by an uninsured driver or a driver with insufficient insurance. This type of coverage also pays if you’re the victim of a hit and run or are struck while walking or riding a bike.