Purchasing auto insurance can be a big decision for some consumers, especially with each individual state having their own minimum insurance requirements that they mandate vehicle owners have in order to legally drive their car. Prior to purchasing any type of automobile insurance it's important to know the various types of auto insurance services and coverage available from the insurance providers.
At a minimum every state requires all vehicle drivers to be insured with liability insurance. Basically, liability insurance covers the expenses that occur if you cause an accident and destroy someone else's car or auto. Liability insurance doesn’t pay for any damage that your automobile sustains in an accident that you cause. Almost every financial lender or loan provider will require a consumer to have full auto insurance coverage instead of just liability insurance in order to preserve the value of their loan against a new or used car that is financed by the bank.
Property damage is the amount of insurance needed to pay for repairs or damages to another motorist's vehicle if you are the root cause of an accident. This is one portion of the minimum required liability insurance as mandated by the individual states. Without this insurance the consumer responsible for the accident would be held accountable to pay for any damages or financial liabilities as a result of the accident. With the price of today's automobiles this could prove to be financially disastrous which is why every state requires a minimum amount of property damage coverage.
Personal injury protection is insurance coverage that pays for a percentage of any medical bills as a result of hospitalization or medical treatment received. It also provides some assistance with wages that are lost as a result of the accident and some death benefits.
Uninsured motorist insurance coverage provides relief to you in case you are involved in an accident without being at fault and the other driver has no car insurance coverage. Although every state requires a minimum amount of liability insurance there are still many drivers that don’t carry or have any auto insurance making this form of insurance almost a necessity in order to give you some peace of mind while driving on the road.
Comprehensive and collision coverage are additional types of insurance coverage that fall under the full coverage umbrella. Normally these types of insurance are required by banks and lenders for any consumer vehicle financing they intend to approve. Comprehensive coverage provides for any type of damage to your vehicle to include theft and vandalism. Collision coverage provides insurance coverage for your vehicle or car if you are found at fault in an accident. In most cases the cash value (as determined by the insurance institution, provider or company) of your vehicle is paid if a total loss of the automobile occurs as a result of the accident.
Finally, bodily injury is another of the minimum required insurance services (under the liability insurance umbrella) required by the states in order to legally drive your car. This insurance provides coverage against medical bills that are a result of an accident that you are found liable for as causing.
Understanding the many different types of auto insurance will help you find the auto insurance coverage you need at a price you can afford thereby allowing you to legally drive in the state you currently reside in.
