Why Do I Need Auto Coverage?
A lawyer may tell you it’s needed to stay legal. But auto insurance is also necessary because accidents do happen. If you’re involved in a car accident, the best way to protect yourself is by having reliable auto coverage. Since accidents usually involve property damage and physical injury, maintaining quality insurance can protect you from having to cover medical and repair costs by yourself.
Types of Auto Coverage
When you’re looking for auto coverage, there are many options to consider. Each one has a specific cost, or premium, and the options you choose make up your overall auto policy. Here is a list of some basic auto coverage options, available at most reputable insurance companies:
- Accidental Death Benefit (ADB)
- Bodily Injury Liability Coverage
- Collision Coverage
- Comprehensive Coverage (sometimes called “Other than Collision Coverage”)
- Medical Payments Coverage
- Personal Injury Protection (PIP) / No-Fault Coverage
- Property Damage Liability Coverage
- Rental Reimbursement
- Uninsured Motorist Coverage
Accidental Death Benefit (ADB)
ADB is an optional coverage you can add to your auto insurance policy that provides an additional death benefit when the insured’s death is caused by an automobile accident.
Bodily Injury Liability Coverage
This type of coverage pays for the medical injuries and legal costs of the passengers, both in your car and other cars, involved in an accident that you are deemed “at fault” for while operating your vehicle. Generally speaking, there will be different levels of coverage you can opt for to make this coverage fit your budget.
This type of auto insurance coverage covers physical damage to your insured vehicle (other than the damage that is already covered under comprehensive insurance) resulting from contact with another car or object.
This type of auto insurance covers physical damage (other than collision) to, or theft of, your insured vehicle. Examples of non-collision causes include:
- Weather (hurricanes, tornadoes, earthquakes, etc.)
- Falling objects (tree limbs, hail, lamp posts, etc.)
Medical Payments Coverage
This type of auto insurance coverage is usually optional and pays for medical costs (and sometimes funeral expenses) resulting from an accident involving you and others riding in your car. It also may cover these expenses if you or your family members are insured while riding in another’s car or while walking.
Personal Injury Protection (PIP) / No-Fault Coverage
This type of auto insurance coverage is not offered in every state. Generally speaking, no matter who is at fault for causing an auto accident, no-fault insurance covers things like medical bills, funeral expenses, lost wages, and other damages incurred by you, your family members, and others riding in your car. This coverage is mandatory in some states.
Property Liability Auto Coverage
This type of auto insurance coverage pays for damages that you cause to another person’s property while operating your vehicle.
This type of optional auto insurance coverage pays for a car rental if your car is unusable due to a reason covered under either the Comprehensive or Collision coverage under your auto insurance policy. Something to note: this coverage is usually subject to a daily rental amount and per accident limit.
This type of optional auto insurance coverage pays for your car to be towed if it becomes disabled. Some insurance companies also offer an all-inclusive roadside coverage option which covers towing and additional roadside solutions for flat tires, locksmith assistance, and running out of gasoline.
Uninsured Motorist Auto Coverage
Uninsured motorist’s coverage pays for injuries and, in certain states, property damage caused by a hit and run driver, an uninsured motorist, or a driver who doesn’t have adequate insurance coverage. This coverage is mandatory in some states.