When you are building your auto insurance policy, you will want to know what type of coverage to include. To know what to add to your policy, you need to know what it covers and who should get it. Here is a quick overview of the different types of coverage you can get for your vehicle.
With liability coverage, if you get into an accident and you are responsible, the medical bills and vehicle repairs for the other party will be covered by your insurance. In most states, you are required to carry a minimum amount of liability coverage. This helps protect you from personal injury lawsuits, which is why it is almost always a good idea to carry more than the minimum coverage.
If you are involved in an accident with another vehicle, you will want to be able to fix your vehicle up. Or, if you get into a single-car accident, you will want to be able to repair your vehicle. You can do that with collision insurance. If you have a car loan, your lender will more than likely require you to carry collision insurance. If you own the car outright, you should keep collision insurance if you can't pay out of your pocket to repair or replace the vehicle if you should get into an accident.
Not all damage to your vehicle is caused by another vehicle. When damage is caused by something else, such as a natural disaster, you will want to have the funds to fix your vehicle up. Like with collision coverage, you need to carry this if you have a loan and if you can't afford to fix up your vehicle if it were to be damaged.
4. Personal Injury Protection (PIP)
If you get into an accident, with personal injury protection, any medical expenses that you incur will be paid by your health insurance. Other things such as lost income and childcare will also be caused. In some states, PIP is required. Even when it is not required, it is still smart to get it, as it can help ensure that you are not saddled with expensive medical bills.
5. Uninsured/ Underinsured Motorist Coverage
Before you get in an accident, you won't know if the people around you are carrying insurance or carrying enough insurance. With uninsured/uninsured motorist coverage, if someone doesn't have enough coverage to pay for your bills, your insurance will cover it. This is just smart coverage to carry as it can protect your financial interests.
When looking at what type of coverage to add to your policy, you will want to consider what it covers and if you need it. Only add coverage that you need and that benefits your policy. To learn more, contact an auto insurance company.