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Auto Insurance
Policy Basics
Automobile insurance is really several kinds of coverage combined into one policy.
Click on each of the features on the left to view the definition of each.
| Bodily Injury/Liability |
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Pays to others on your behalf for bodily injury if the injury or damage was your fault. It will also cover any legal bills you may have. Most states require that you carry a minimum amount of bodily injury liability coverage. Extra is recommended if you have a larger net worth. |
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| Property Damage |
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Pays for the damage to someone else's car or property when you get into an accident. This coverage is usually cheaper than bodily injury coverage. |
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| Collision |
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Pays for the damage to your car that is accident related. Also, for most policies, this coverage will cover you when you are driving a vehicle that you don't own, but are authorized to use. |
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| Comprehensive |
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Pays for damage to your car that is not accident related, such as theft, vandalism, fire or storm damage, etc. Together with collision coverage, it can account for one third to one half of your premium. |
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| Medical Payments |
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Reimburses you and any passenger in your car for medical in, on, or upon a car regardless of who caused the accident. Pays if you or a family member are hit by a car as a pedestrian or are hurt while riding in someone else's car. |
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| Uninsured Motorist |
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Pays you if the at-fault party in an accident was uninsured or underinsured. And also pays if injured by a hit-and-run driver. You can collect not only for medical bills caused by an accident, but also for lost wages and pain and suffering. This coverage is very inexpensive because the odds of hitting an uncovered driver are small. |
I have health insurance, so I don't need medical coverage, right?
Some people skimp on med pay coverage because they assume their medical bills will be covered by their health insurance. This may not be a good idea:
- While your health coverage may be excellent, your passengers' coverages may be poor.
- Med pay covers funeral expenses which are not reimbursed by health insurance.
For the relatively small premium, the extra coverage is worthwhile.
#38599
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