Types of Car Insurance Available

Types of Car Insurance Available

Types of Car Insurance

If you have a loan on your vehicle or own it outright, you need to be sure you have the right type of car insurance coverage. Car insurance is divided into two types; collision coverage and comprehensive coverage. Collision coverage will pay for repairs and replacements to your car in the event of an accident. Comprehensive coverage, on the other hand, will repair your car if it’s damaged by a storm, theft, or vandalism and will replace your vehicle. Find out which type of coverage your car needs according to your lender, your state, and the requirements set forth in your vehicle contract.

type of car insurance

Comprehensive coverage

Most people who purchase a new vehicle buy comprehensive coverage so that in the event they need to make repairs due to a fire, theft, or vandalism, their car will be fully repaired and they won’t have to pay for it out-of-pocket. If you’re financing your new car, the finance company may require you to carry collision coverage as well. If you have a loan on your vehicle, your bank will likely require you to carry collision coverage as well, since they don’t want you to go uninsured. Make sure to check with your lender or credit union to be sure they don’t have any prepayment penalties associated with your financing terms.

Collision coverage

Collision coverage limits are what you’ll pay for in the event of a covered accident. There are usually three different minimum amounts required to be fully insured. The first is the minimum liability amount, which is the lowest amount and the most affordable. The second is the property damage minimum amount, which is the next highest amount and the most expensive.

Bodily injury liability coverage

The third minimum amount is the bodily injury liability coverage. This type of coverage pays for the medical expenses and funeral expenses of those injured in a car accident. In order to meet the bodily injury liability coverage requirement, you must have a policy with a maximum limit of liability for bodily injuries. The maximum limit will be the higher of the two highest amounts, or the cost of caring for the person who has passed away. This coverage doesn’t pay for property damage or tickets.

Bodily injury liability coverage will also cover the costs of treating injuries that happen to other people because of your negligence or lack of reasonable care while driving. Many times this type of insurance is required by law, but you can check with your insurance agent to find out if it’s required in your state. The final requirement for this type of insurance is the legal costs, which will be paid by you or your insurance company in the event that you get sued for medical expenses or lost wages because of the accident.

Roadside assistance policies

Roadside assistance policies help pay for the expenses that arise when you become disabled from a car accident. These policies are designed to help cover the expenses that come with being stranded in the middle of nowhere because your car is not functioning properly. Many times this type of insurance will also cover the cost of borrowing a ride to the nearest location to help cover your transportation needs until you are able to get on the road again. Some roadside assistance plans even offer coverage for rental cars and personal items that are in the vehicle at the time of the accident. If all of the coverage options that you have chosen do not meet your needs, you should contact an insurance agent to find out what you need to have in order to have these types of plans set up.

Bodily injury liability insurance is required in every state of the United States as well as in many other countries around the world. This type of policy helps cover the expenses of treating injuries to others caused by you. It also covers any legal costs that are related to the accident, which will depend on the circumstances of the case. Many times this type of car insurance is required, but you can check with your insurance agent to find out if it’s required in your state.

Car insurance providers will try to convince you that you need both bodily injury liability coverage and vehicle liability coverage. What you need to understand is that these two types of insurance coverage are usually required by every state in the United States. If you are in a situation where one of them is required, you should purchase it before the accident occurs so that you’re covered in every state. If you don’t have these policies, you could be financially devastated if you were to get into an accident. Even if you aren’t required to have these policies, it’s always better to be safe than sorry.