Car Insurance Coverage Guide

With so many types of car insurance coverage available, it can be hard to know what would be covered under the plans you're looking at. With that in mind, this article will help you understand what types of auto insurance coverage are available and what each type of policy covers.

Collision coverage pays only for damage to your own vehicle, usually due to a car accident with another car or an object that you hit. It typically provides coverage for repair or replacement of your insured car up to the Actual Cash Value of the vehicle. Actual Cash Value of your vehicle is usually the lowest Blue Book value for the make and model of your vehicle and takes in depreciation due to age, use, and wear and tear.

Comprehensive coverage pays for losses from fire, theft, falling objects, vandalism, and "acts of God". It typically covers damage to your car that isn't caused by collision.

Bodily injury coverage means that it will pay for costs to other people when you are at fault.

Property damage coverage pays for property damage when you are at fault.

Medical payments coverage pays for your own or your passenger's medical expenses. It covers reasonable and necessary treatment for bodily injury caused by an accident that was covered by your car insurance, regardless of who is it fault. Types of treatments that are probably covered include x-rays, doctors, hospital costs, surgery, ambulance fees, and funeral expenses.

Personal injury protection is available in certain areas, such as no-fault states. It covers a wide variety of medical expenses and the types of expenses it covers vary by state. Besides reasonable and necessary expenses it may also cover income continuation, loss of services, and child care expenses for bodily injury caused by an accident covered by your insurance plan.

Uninsured/underinsured motorist covers you if the other driver does not have adequate insurance.

There are also optional services sometimes provided by insurance companies for added convenience and protection of your car. Some of those services are listed below.

Emergency roadside assistance covers you if you are stranded by a breakdown. Sometimes they offer towing or roadside service, bringing gas, changing a tire, or jump starting your vehicle. If your company offers this program, find out what they cover. Sometimes they cover towing for several miles or until a certain point. There are usually restrictions to this type of program.

Car rental reimbursement helps you get a rental car after an accident while you wait for your car to be repaired. It typically pays a flat sum to assist you with expenses that you may incur following an accident.

Auto glass replacement is sometimes available if it's not covered under your comprehensive car insurance policy. It covers auto glass repairs/replacement.

Remember that every state has different requirements for the type of car insurance you're supposed to have. You should check with your insurance company to make sure that your coverage will meet the minimum requirements by state law. You may also face higher requirements if you lease your vehicle Your insurance company's policies may vary from the car insurance coverage types listed here. It is important to know what type of coverage your policy provides, and whether you need certain plans. For example, some professional organizations offer roadside assistance, so you may already be covered, and if you have a new or leased vehicle, your car may still be covered under warranty.

See my other articles for more information on shopping for car insurance for more information on discounts and other useful tips.