When you purchase car insurance, you are essentially purchasing coverage for yourself and anyone else that you have listed on your policy (such as a spouse, children, or other family members). Your policy provides coverage whether you are driving your vehicle or someone else’s vehicle, and also provides coverage to anyone who is not on your policy but drives your vehicle with your consent.
That being said, there are many different types of policies, and each offers different types of coverage. Below is a short overview of the most common types of coverage offered by car insurance companies:
1. Auto Liability Coverage
Auto liability coverage is specifically designed to cover you if you are found to be at fault in an accident. It typically covers damage to objects and other vehicles beside your own, as well as injuries to other drivers and any passengers they may have in their car. This coverage also covers you if you are sued due to your role in an accident. This is the type of insurance that most states require drivers to carry.
2. Collision Coverage
Collision coverage specifically covers damage that your vehicle receives during a collision accident. This may involve colliding with another car, as well as as a tree, guardrail, or other structure.
3. Comprehensive Coverage
Comprehensive coverage is meant to provide you with protection against events that are beyond your control. Examples include, but aren’t limited to, damage from falling trees or branches, vandalism, theft, windshield damage from rocks or debris, etc.
Broken glass (i.e., windows and windshields) are some of the most common claims made under this type of coverage. With this in mind, it’s important to understand whether or not your policy includes a glass deductible that you might need to pay out of pocket before coverage kicks in.
4. Uninsured or Underinsured Motorist Coverage
If you are involved in an accident with an uninsured or underinsured motorist, this coverage is designed to protect you from out-of-pocket expenses. Uninsured motorist bodily injury (UIM) coverage covers medical bills you or your passengers may receive, while uninsured motorist property damage (UMPD) coverage covers damage to your vehicle. Some states require you to carry this type of policy as well as liability coverage.
5. Medical Payments or Personal Injury Protection (PIP)
Both medical payments and personal injury protection (PIP) coverage are designed to cover medical bills if you or your passengers are injured during an accident. If you carry one of these policies, you will be covered no matter who is at fault for the accident.
