Buying Auto Insurance: Types of Coverage
Different auto insurance companies offer many different types of coverage. Most states require drivers to purchase a minimum amount of certain types of coverage. Here are brief descriptions of typical types of auto insurance coverage offered:
- Body injury Coverage : This coverage is mandatory in most states. Bodily injury coverage pays for medical bills, lost wages, treatment and/or funeral costs for anyone injured or killed by your car. Such coverage will also pay for “pain and suffering” damages when a third party successfully sues.
- Property-Damage Liability Coverage: This coverage pays for the repair and replacement of vehicles and other property damaged when you or another authorized driver causes an accident.
- Medical Payments Coverage: Usually optional, this coverage pays for medical expenses over and above amounts covered by personal insurance protection, no matter who caused the accident.
- Personal Injury Protection: Pays medical expenses and some percentage of lost wages to you or anyone authorized to drive your car, no matter who caused the accident.
- Comprehensive Coverage: Pays for damage to or loss of your car in the event of fire, theft. Again, your lender may require this coverage if your car is financed.
- Rental Reimbursement: Reimburses up to a specified amount per day for car rental or transportation costs while your car is being repaired following an accident.
- Protection from an Uninsured or Underinsured Motorist Coverage: Protects you, passengers and anyone authorized to drive your car against bodily injury caused by an uninsured, underinsured or hit-and-run driver.
- Towing and Labor: It will covers up to a specified amount for labor charges when your car breaks down, whether or not there is an accident involved.
- Auto Replacement: The full car replacement value apart from the depreciated value.
Generally your auto insurance will cover the above sides.
Article Written by Kenneth Parker from “Finance ideas 4u”
Image by jcrakow.
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Many insurance companies participate in a national database that tracks claims. They will also check you MVR records of any tickets or accidents. It is very difficult to slip one past an insurance company.
We live in Florida, and my son has just turned 16, He wants to get his licenses but we don’t want our insurance to go up too much. From what I hear it is very expensive, yet i hear other people saying that some auto insurance company’s have very cheap rates for adding a first time driver.
Yes, it’s for security measure
They don’t want to lose money on you and I, I guess…
Cheap rates don’t always the best – You should learn what those companies are really offering. Also, watch for the hidden charges that all-in-all will turn a seemingly cheap auto insurance into the most expensive one.