Auto insurance coverage is mandatory for motorists in most states. There are a number of auto insurance coverage types to suit different types of vehicles and drivers. To decide the type of insurance that you require, you need to know the things that you want to protect in case you suffer a loss caused to your person as well as property. You should also know what type of insurance will protect you from losses due to injury or damage to property suffered by others. You can educate yourself with information on how to reduce your auto insurance premiums without compromising on the various types of coverage. You have to understand the various insurance coverage stipulations of the state in which you live. Under Californian laws, al drivers must possess auto insurance making them accountable in the event of an accident. You can get the best auto insurance coverage for the best price by shopping around and doing some research.
Most of the states require that every driver must have certain minimum level of auto insurance coverage. Let us take a look at some of them.
1. Minimum Liability Coverage: Basic liability coverage is absolutely necessary. Having too little auto insurance can make you pay huge amounts towards legal costs for several years. The minimum coverage required by many states is $15,000 to pay for a single person injured by you in an auto accident and up to $30,000 for all those injured and $5000 for property damages. It is in your own interest to carry more liability coverage to make sure that you do not face shocks and heavy financial loss if you are involved in an accident.
2. Personal Injury Protection (PIP) coverage: This is taken to cover the medical, hospital and funeral expenses of the insured driver, the occupants of his vehicle and others hit by his vehicles. It covers the basic protection for the insured driver’s injuries regardless of fault.
3. Collision Coverage: Collision coverage pays for damage to your car is involved in a collision with another vehicle. It pays for repairs to your vehicle minus the deductible you have chosen. If you use an older car, you need not carry this insurance as the coverage is usually limited to the value of the car. But if you have a vehicle loan the lender may insist on carrying this coverage.
4. Comprehensive Coverage: Comprehensive coverage protects the motorist’s vehicle for losses due to reasons other than collision such as theft, fire, flood, animals or vandalism. Though this is not required by the states and is optional, if you have a vehicle loan the lender will require you to have this coverage.
5. Uninsured and Underinsured Motorist Coverage: This covers you and the insured members of your family for bodily injuries, death or damages caused by an uninsured driver. This will cover your costs if the other driver does not have insurance or not adequately insured. This insurance coverage covers the policy holder, the occupants of the vehicle and also the other driver involved in the accident. Most insurance advisors recommend this as a must carry coverage.
6. Accidental Medical Protection Plan (AMPP): This coverage is also known as Accidental Death and Dismemberment and protects you and your family from medical expenses due to accident by paying the expenses directly to you without any deductible. This plan also includes coverage for towing, lock out services, tire changing, battery services etc.
7. Bodily Injury Liability Coverage: This coverage will pay for all expenses in case of bodily injury suffered by you in an accident.
There are many other coverage types such as Accidental Death Benefit, Custom Parts and Equipment Rental Car reimbursement, work loss coverage known as Optional Basic Economical Loss and others.