auto insurance

Auto insurance is about protection and coverage, but these notions sound quite general. Especially if you want to have a more detailed understanding of what your policy contains and how you can make it cheaper. One of the most important aspects that will strongly influence your premiums is the amount of coverage you carry with your policy. Of course, it would be very easy if you had only one type of coverage with an auto insurance policy, but the fact is that a typical insurance policy is comprised of several coverage types. And each coverage type has its own amount carried by the policy. So before you start tweaking the amounts, you have to learn what coverage types are typically present in a standard auto insurance policy.

Collision coverage

As the name suggests, this type of coverage will pay for the expenses caused to your car due to a collision.

Comprehensive coverage

This type of coverage is typically bundled together with collision coverage into a single item as it pays for the damage resulted from causes other than collision, for example fire, theft, earthquake, etc.

Liability coverage

This is a type of coverage legally required in all states in the US representing the legal responsibility of the policy holder to pay for damage or injuries delivered to another parties involved in the accident while driving the insured vehicle.

Medical costs coverage

This type of coverage is responsible for paying the medical costs involved and is usually implied to the driver and the passengers of the car included into the insurance policy. Insurance companies stress the importance of this type of coverage and recommend its prompt use in order to minimize the risk of the party injured suing the policy holder.

Personal injury protection coverage

This is an additional type of coverage that can enhance the medical costs coverage carried by your policy. This coverage type will take effect only when the accident is covered by the medical costs coverage and will reimburse things like lost wages or special care if needed.

Deductibles

Not being a coverage type, the deductible is closely connected to most types of coverage carried by your policy. Deductible is the amount of money you will have to pay out of pocket before your actual coverage kicks in. Not all types of coverage have a deductible so study your policy closely in order to learn which are subject to it and which are not.