Purchasing car insurance seems simple enough, but when you really start shopping, it can feel overwhelming. Let’s break down the four basic coverage of the standard personal auto policy Liability coverage. Liability Coverage provides you with the coverage you need in the event that you’re at fault in an automobile accident.
This coverage offers two types of protection: coverage for injuries to other people and coverage for damage to someone else’s property while you or a family member are operating any automobile. So, if you accidentally hit someone else’s and injure the other driver, your Liability Coverage would pay for not only the covered damages to their vehicle but also for the medical expenses related to their injuries And yes, I said “their” injuries, not your own, which leads us to our second coverage. Medical Payments Coverage. Because Liability Coverage only provides coverage for injuries caused to the other people involved you’ll need Medical Payments Coverage to help pay medical expenses related to injuries sustained by you or your passengers in an accident. This coverage comes into play no matter who is at fault. The third part of personal auto insurance is Uninsured Motorists Coverage or UM Coverage. UM, coverage protects you if you’re involved in an accident with someone who breaks the law by not carrying their own auto liability insurance. It does this by helping pay for any medical expenses you incur as a result of getting hit by an uninsured driver. And although it may not sound fair, these types of accidents do happen. According to statistics, nearly one in seven drivers on the road is uninsured, which makes protecting yourself an absolute necessity!
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In many states, you can also purchase additional protection called Underinsured Motorists Coverage. Underinsured Motorist Coverage provides you with additional protection, for when the other driver has insurance coverage, but just not enough to fully cover all of your medical expenses. By now, you may be wondering how you’re going to pay for damages to your own car. That’s where the fourth and final part of your auto policy comes into play, Coverage for Damage to your Car. Also known as Physical Damage coverage. It pays for direct and accidental loss to your vehicle, there are two parts to Physical Damage coverage: Collision – for when your car impacts another vehicle or object or is upset, andOther Than Collision, which covers almost any other type of direct, accidental loss not excluded by your policy.