Different Kinds of Insurance Coverages You Must Know
Are you looking for new auto insurance for the first time? Or are you looking for an auto insurance to change your present or past insurance? If your answer is yes, then do you know what the different auto insurance coverages that exist are? If your answer is yes, then that is good for you. But in case you don’t know these different insurance coverages, or in case you know only a few or you’re having trouble understanding these coverages, this topic will erase all questions.
In different states, each respective state Department of Insurance requires different sets of coverages with different range of minimum amount of coverage for their motorists. And thus it is important to follow these requirements to avoid any problems with the law. And aside from following the required car insurance coverage set be the state Department of Insurance, you can also have additional coverage for peace of mind.
And before following the required car insurance coverage by the state and also having additional coverage, you should know first what these are, so you could know why the state requires you such coverage and also why it is necessary in some cases to add some more coverage. Here are the following coverages with their respective explanation.
1. Liability Coverage. In this kind of insurance coverage that is offered by different auto insurance companies, it exists to insure for the payment of those things that suffered by the other parties in an accident for which you are found to be at fault. This coverage is one of the most frequently required by the state for every motorist to have in their policies.
2. Property Damage Liability. This coverage, when you are at fault of an accident, pays or covers for the damage to the property of the other parties involved in the accident.
3. Bodily Injury Liability. In this insurance coverage, if you are again found at fault of a certain accident, all the bodily injuries suffered by all in other parties involved in the accident will be covered by your insurance.
4. Comprehensive Coverage. This coverage, unlike the previous three which are for the other parties’ damage or loss and in cases of accidents, will insure you as the insured car owner if in case anything happens to your car that does not involve accidents. Instances where comprehensive coverage covers or insures your car or property are when your property is damaged from severe weather conditions.
5. Fire and Theft Coverage. This covers your property as an insured owner in case your property is stolen or totaled due to fire. And it also offers specific coverage in case your car suffers some damage while being transported by a trailer.
6. Collision coverage. it covers when in case your car is damaged due to any kind of collision with any kind of object, whether the object is moving or not.
7. Physical Damage Coverage. It is the summary of three types of coverage, fire and theft, comprehensive, and collision coverages. It is advisable for those owners of luxury cars, and other types that have high resale value.
8. Persona Injury Protection (PIP). PIP, also known as no-fault coverage, is required in many states. It insures you, all your passengers, and/or anyone you authorize to drive your car in case any accident occur. These insurance coverage covers for medical expenses, which include rehabilitation, funeral expenses if necessary, and lost wages.
9. Underinsured and/or Uninsured Motorist Coverage. This coverage insures you in case you get involved in an accident with a driver who can either be insured, but with only minimal coverage, or a driver who is totally uninsured.
10. Gap Insurance. Because your car’s value or price lowers as soon as you bought it, gap insurance pays for the gap from the original price before you bought it to its price after you already bought and owned it.
11. Rental Car Insurance. Only few insurance companies offer this coverage, it covers you as the insured motorist in case you drive a rental car.
12. Pay-Per Mile Coverage. As the name suggests, you as the insured motorist will pay for your insurance based on how far you drive rather than on annual estimates.
The entire above mentioned are necessary depending on what situation you have as a motorist. Some of these are required by different states for their motorist to carry. And some are additional coverages you could have for more peace of mind. Your car insurance rate will be higher if you have additional coverages, but it still assures you of better peace of mind.
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