Choosing Excellent Insurance Coverage

3 Things You Should Understand About Auto Insurance

If you own a car, you are obligated in most states to carry auto insurance. It is essential to not only have auto insurance but to understand how it works.

Thing #1: State Required Insurance Is All About Liability

Some people wrongly assume that the minimum insurance they are required to carry by the state will provide them with money to fix their vehicle if it is damaged in an accident. In truth, state requirements are generally all about liability. It is about providing the other party in an accident, should you be the one held responsible, with money for them to fix their vehicle and take care of their medical bills. 

Thing #2: Always Protect Your Health

In some states, you are required to carry personal injury protection (PIP) or MedPay with your auto insurance, although this is not a requirement in all states. Regardless of your state's requirements, you should carry either PIP or MedPay.

This type of coverage will pay your medical bills regardless of who was responsible for the accident. This is important coverage to have, as it will pay your medical bills related to your accident. You should carry this coverage regardless of if you have personal health insurance. PIP coverage does not have a deductible, and if your costs don't exceed your PIP coverage, you may not have to pay anything for your healthcare like you would with your regular health insurance.

Thing #3: Understand the Difference Between Comprehensive Insurance & Collision Insurance

If you want to protect your car from accidents and get money if your vehicle is damaged, you are going to want to carry two different types of insurance.

Collision insurance will reimburse you for damage to your car, minus your deductible, when your vehicle hits another object, be it another moving car, stationary car, or a mailbox. Comprehensive, on the other hand, will reimburse you for damage to your car if your car is damaged in a flood, or if a tree branch falls on your vehicle, or if your vehicle gets stuck in a damaging hailstorm. 

Keep in mind that the auto insurance you must carry in most states is about providing you with liability insurance if you cause an accident. If you want your medical needs taken care of, you need PIP coverage. If you want the cost of repairing or replacing your vehicle to be covered, no matter the situation, you need comprehensive or collision insurance.