When it comes to car insurance quotes comparison, you need to be sure of what you’re dealing with before making this all-important purchase decision. And by this we are merely implying to understanding the different types of auto insurance policies on offer.
While some are mandatory, there are those you can make do with or with. That’s why it pays off to do your homework before you finally purchase auto insurance. In this simple guide, we examine some of the common types of car insurance coverages you should know about.
Collision Coverage
Collision insurance coverage covers damages to your car in the event you hit another vehicle or an object. It is generally required by your lender is you have an outstanding auto loan, but may be optional if your car is fully paid off.
This type of auto insurance pays for any necessary car repairs for your vehicle following an accident involving another vehicle, a single-car, if your vehicle rolls over or fall, and an object, such as a road sign or a tree.
Keep in mind collision insurance coverage only covers the repair and replacement costs for your own vehicle. It doesn’t cover damages to another vehicle.
Personal Injury Protection
Personal Injury Protection (PIP) covers medical bills, hospital bills, and other costs associated with car accidents that are not already covered under your health insurance policy. Some states require drivers to obtain PIP, while other states deem it optional.
This type of auto insurance policy pays for medical expenses, and possibly funeral expenses or lost income, regardless of who is found at fault in the accident. It can also cover pedestrians who have been struck by a vehicle while walking or riding a bike.
As for the coverage limits, it covers medical expenses and lost wages only up to the limit determined by your insurance agreement. If your expenses exceed your limit, you may be able to file a lawsuit against the driver responsible for the accident to cover the difference.
Of course, there are other types of auto insurance coverages you should know than those included in this quick guide.