Basic personal auto insurance is required by most states and provides you with some financial protection in case of a crash. But insurance policies vary, depending on the type of coverage you choose and can be very confusing. Learn how car insurance works and what types of coverage are available.
Understanding Auto Insurance
Auto insurance is a contract between you and your insurance company that protects you against financial loss in the event of a crash. In exchange for paying a premium, the insurance company agrees to pay your losses as outlined in your policy.
Auto insurance provides coverage for:
- Property damage-such as damage to or theft of your vehicle
- Medical the cost of treating injuries, rehabilitation and lost wages
- Liability-your legal responsibility to others for bodily injury or property damage
Basic auto insurance is mandated by most US states and laws vary. Auto insurance coverages are priced to allow you to customize to your needs and budget. Policies are generally issued for six-month or one-year time frames and are renewable.
Who Is Covered By My Auto Insurance?
Your auto policy will cover you and other family members on your policy, whether driving your car or someone else’s car, with their permission. Your policy also provides coverage of someone who is not on your policy is driving your car with your consent.
Your personal auto policy only covers personal driving, whether you’re driving to work or running errands, that may not provide coverage if you are using your car for commercial purposes.
Is Auto Insurance Required by Law?
Auto insurance requirements vary from state to state. Nearly every state requires owners to carry:
Bodily Injury Liability
Covers costs associated with injuries or death that you or another driver causes while driving your car.
Property Damage Liability
Reimburses others for damage that you were another driver operating your car causes to another vehicle or property.
Medical Payments or Personal Injury Protection(PIP)
Provides reimbursement for medical expenses for injuries to you or your passengers. It will also cover lost wages and other related expenses.
Uninsured Motorist Coverage
Reimburses you when an accident is caused by a driver who does not have auto insurance, or in the case of a hit-and-run crash.
Underinsured Motorist Coverage
Covers costs when another driver lacks adequate coverage to pay the cost of a serious crash.
Reimburses you for damage to your car that occurs as a result of a crash with another vehicle or object, when you are at fault.
Auto insurance policies and coverage issues can be confusing. The attorneys at the Insurance Justice Center are available for a free consultation to answer any questions you may have and make sure your rights are protected.
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Give us a call at 877.765.9010 or fill out this form to receive a free consultation.
The Insurance Justice Center serves clients nationwide, handling a wide range of injury claims. We are interested in hearing from you.