Knowing the Insurance Types Helps
There are several different parts to your Car insurance policy. When you are looking at Auto insurance rates make sure you are comparing the same terms.
A liability is the monetary obligation you have to pay for damages to property or persons that you have caused. In the US, states follow two views on insurance: Fault and No-Fault. In a Fault or At-Fault states, you must carry some form of minimum liability insurance to cover damages you caused. In No-Fault states, your insurance company agrees to pay for any damages to you and your property (car) regardless of whether you are responsible or not for any or part of the collision.
Liability generally carries a maximum paid to any individual as well as maximums paid per accident and per policy. State minimums are the lowest threshold of insurance the state will allow. If you purchase the state minimum, it translates into the maximum your policy will pay out. If the costs of an accident exceed the maximums of your policy, you are still responsible for the remainder of the payments. Types of Liability: (Fault = F, No-Fault = NF)
Bodily injury (F): goes beyond the medical expenses but also includes lost wages, pain and suffering to be paid to person or persons whom you have injured in an accident.
PIP (Personal injury Protection) (NF): pays you and passengers in your vehicle, for hospitalization, outpatient treatment, rehabilitation, loss of work compensation, funeral expenses, and some survivor benefits.
Uninsured or under insured: Requirement depends on the state. Protects you and your property in an accident with someone who either does not have sufficient insurance to cover medical and property damages, or has no insurance.
Collision (F & NF): only covers damages to your vehicle resulting directly from an accident. It does not cover damages from hit and run, road debris kicked into windshield, or acts of nature such as storm (hailstones).
Comprehensive (F & NF): covers all costs of repair or replacement for any damage to vehicle including acts of nature. It is often a requirement for financed vehicles to insure the replacement value of the vehicle is covered in case the automobile is totaled. Payment is minus any deductibles.
Understanding what to compare makes reviewing Auto insurance rates easy. We are here to help you get the best quotes from local insurers. Try us now to see what you can save.