When purchasing an auto insurance policy, you will find that there are many different coverage options available to you. While the law will dictate the minimum amount of coverage you need to purchase in order to be on the road legally, purchasing just this minimum amount of coverage could leave you without the actual level of coverage that you need in the event that you are in an accident. Unfortunately, many people do not fully understand the different types of auto insurance coverage and what each of these insurance products offers. As a result, they ultimately end up purchasing a policy that does not meet their needs. Taking the time to review some of the most popular coverage options outlined below can help to prevent you from making this same mistake.
Liability Auto Insurance
The law requires that you maintain liability auto insurance on all vehicles that are on the road. This type of auto insurance provides coverage for other drivers by compensating them for property damage or personal injuries in the event you are liable for causing the auto accident that resulted in the damage or injuries in question. If you are injured or your vehicle is damaged in an accident, this type of insurance coverage will not provide you with any compensation.
Collision Auto Insurance
The way that collision auto insurance works is essentially the opposite of liability coverage. While collision coverage will compensate you for damages to your own vehicle in the event that you are liable for causing an accident, this insurance coverage does not address the issue of your legal liability for any damages that are done to another person's vehicle.
Personal Injury Protection
While collision auto insurance coverage offers protection against financial losses related to damage to your vehicle, personal injury protection will provide you with coverage for any medical expenses you incur as the result of injuries suffered in an accident for which you are found liable. In cases where the other driver is found liable for causing your accident, personal injury protection can also help to cover any excess medical bills that you incur in the event that the other driver did not have adequate coverage to pay these bills in full.
If your vehicle is struck by a driver with no insurance coverage or inadequate insurance coverage, uninsured/underinsured motorist coverage will provide you with the coverage you need in order to get your vehicle fixed.
In addition to determining what types of auto insurance coverage are best suited for your needs, it is important to determine just how much coverage you require to realistically cover your out-of-pocket expenses in the event of an accident. Working closely with a qualified auto insurance broker or agent can help you to make this determination.