When it comes to auto insurance, we all seem to know that we need it. However, we don’t all understand what the coverage entails and what it omits. Today, we are going to answer some of the most commonly asked questions about car insurance to help readers better grasp what this insurance is.
What Type Of Coverage Should I Get?
Liability Coverage – This is the bare minimum required by every state. This coverage pays for the injuries and damages that you cause to others. This doesn’t provide any sort of financial assistance for your vehicle damages or your injuries from the accident.
Personal Injury Protect (No-Fault) Coverage – In some cases, there are requirements for all drivers to have this type of no-fault coverage. This allows you to file an insurance claim with your own insurance provider for the injuries you obtain from an accident that was your fault.
Uninsured Motorist/Underinsured Motorist Coverage – In cases where your vehicle is damaged by another party who doesn’t have insurance coverage or who doesn’t have an insurance coverage limit that will cover all the damages, this car insurance will help. This is legally required in some states.
Collison Coverage – This type of car insurance plan covers the cost of damages and injury-related expenses for your vehicle when you are at fault for an accident. This is what most people mean when they say full coverage. If you are currently financing a vehicle, you will typically have to retain this level of coverage for the vehicle.
Comprehensive Coverage – This type of car insurance is intended to cover the insurer in the case something other than an accident caused damage to their car. This could be a tree falling on the car, flooding, or hail damage.
Towing Coverage – In the event that your vehicle breaks down or you need roadside assistance, towing coverage can help. Most policies will cover non-accident towing, jumpstarts, lockouts, roadside labor, and tire changes.
As you can tell, there are some insurance coverages that you must legally obtain to drive within your state. Other types of car insurance coverage, such as comprehensive coverage, is optional.
What Coverage Amount (Limit) Do I Need To Have?
Each car insurance policy will come with a maximum limit of what the provider will pay out for each specific type of expense. These are typically written in a format such as $15,000/$30,000/$5,000. Let’s break this type of coverage down so you can better understand.
$15,000 – Limit for injury or death expenses for one person.
$30,000 – Limit for injury or death expenses for multiple persons.
$5,000 – Limit for property damage from the accident.
Each state will require its own amount of minimum coverage limits you must have for each of these areas. In order to legally drive in the state, you must have the required coverages.