Know Your Car Insurance

Shopping for car insurance can be a baffling ordeal, especially if you're not familiar with the various types of coverage options available. In this post, we'll explain the different types of insurance coverage so you can determine which coverage is right for you.

Liability Coverage

Most states require drivers to have liability coverage at a bare minimum. Liability coverage has two core components:

• Bodily Injury Liability: Pays for other person's injuries in an accident
• Property Damage Liability: Pays for property damage caused by an accident
• Since this is the bare minimum, you'll likely want to purchase additional coverage.

Collision Coverage

Liability coverage is designed to cover damage to another person's property. To pay for repairs for your own vehicle, you'll need collision coverage.

Collision coverage will pay to repair your car. If the repair costs exceed your value (referred to as a "total loss"), collision coverage will pay to replace your car.

While collision coverage is typically optional, some leaseholders or lenders may require you to carry an active policy.

Comprehensive Coverage

As the name may suggest, comprehensive coverage can protect your car from a wide variety of damages. This includes things like:

• Hail
• Fire
• Flood
• Theft
• Vandalism

If your car is damaged by a covered hazard, comprehensive coverage will pay to repair or replace the vehicle.

Uninsured and Underinsured Motorist Coverage

While insurance is legally required, that doesn't prevent some uninsured motorists from getting behind the wheel. While underinsured drivers do have some coverage, they might not have an insurance policy that is large enough to cover your medical bills.

Uninsured and underinsured motorist coverage will pay for your medical expenses in the event you're in an accident with an uninsured or underinsured driver.

In some states, this coverage will also take care of repairs for your vehicle. Check with your insurance provider to learn more about your options.

Medical Payment Coverage

In some states, you may be asked to carry coverage for medical payments. If you or your passengers are injured in an accident, medical payment coverage can pay for any resulting medical costs.

This policy also applies to any family members who are driving the insured vehicle, so it can be an important policy option for the parents of teen drivers.

Personal Injury Protection (PIP)

Personal injury protection (PIP) is basically an enhanced version of medical payment coverage. This coverage option will pay for your medical expenses; however, it will also extend to other related expenses that are the direct result of injuries from an automotive accident. It can be used to pay for things like:

• Child care expenses
• Lost income
• Housekeeping services
• Funeral services

Make sure to check with your insurance provider to learn precisely what their protection plans will cover.

Personal injury protection is only available in certain states, though some states actually make it a requirement for drivers.

Go Beyond the Minimum

While liability coverage is a basic insurance requirement, drivers should consider augmenting their insurance policy with additional coverage. Your insurance provider can provide options that can effectively cover you and your vehicle in the event of an accident.