Insurance Guide: What Does Car Insurance Cover?

Did you know that 1.3 million people lose their lives in traffic-related accidents every year?

It’s an unfortunate fact of life that you could be driving down the road and get into an accident with another car. Even drivers that follow the rules of the road and go to the speed limit can suffer harm from drivers that don’t.

That’s why it’s essential to make sure that you’re protected in the case of an accident. That’s where car insurance comes in.

We want to help you, so keep reading, and we’ll explain what car insurance 2022 covers.

Bodily Injury Liability Insurance

Bodily injury liability insurance is one of the most important types of insurance for drivers to have. This insurance covers medical expenses and other damages that may result from an accident for the policyholder deemed to be at fault.

Choosing a policy with adequate coverage limits is important, as medical expenses can add up quickly. It is also essential to compare insurance quotes to know your best choice.

Liability for Property Damage

Liability for Property Damage is insurance that covers damage to someone else’s property. This can include their car, home, or other belongings. It is vital to have this type of insurance because it can protect you from having to pay out of pocket for someone else’s damages.

Personal Injury Protection / Medical Payments Coverage

Regarding car insurance, it’s important to know what Personal Injury Protection (PIP) and Medical Payments Coverage (MPC) are and what each one covers. PIP is insurance coverage for medical expenses and lost wages that result from an injury, regardless of who was at fault.

MPC is insurance coverage for medical expenses incurred due to an accident, regardless of who was at fault. PIP and MPC can be sold together or separately, and each state has different laws regarding the minimum amount of coverage that must be purchased.

Collision Coverage

An insurance guide would not be complete without discussing collision coverage. This is one of the most important coverages of your car insurance policy.

Collision coverage covers damage to your car caused by a collision with another vehicle or object. This coverage can be expensive, but it is worth the price if you are in an accident.

Comprehensive Coverage

Comprehensive coverage is one of the most common types of car insurance. It covers damage to your car that’s not caused by a collision, such as fire, theft, or vandalism.

It also covers damage from events like hail, floods, or earthquakes. If you have a loan or lease on your car, your lender will require you to have comprehensive coverage.

Uninsured Motorist Coverage

Car insurance covers a wide range of potential risks, but one of the most basic forms of coverage is uninsured motorist coverage. This type of coverage protects you financially if a driver who does not have insurance hits you.

Without this coverage, they could leave you with significant medical bills and other damages. Uninsured motorist coverage is an integral part of any car insurance policy, and it is worth considering if you do not have this coverage already.

Underinsured Motorist Coverage

It may also cover the cost of medical treatment if you or your passengers are injured. In some states, car insurance covers the cost of property damage caused by an uninsured or underinsured driver.

Underinsured motorist coverage is an optional coverage you can purchase from your car insurance company. It pays for your medical expenses and property damage if you’re involved in an accident with a driver who doesn’t have enough insurance to cover your damages.

Other Car Insurance Coverage

Regarding car insurance, most people think about standard coverage options like liability and collision. However, depending on your needs, other types of car insurance coverage can be beneficial.

Read below for the other types of car insurance coverage you may want to consider:

Gap Insurance

Gap insurance is an insurance policy that covers the difference between what you owe on your car loan and the actual value of your car. If your vehicle is totaled in an accident, gap insurance will pay the difference between the real cash value of your vehicle and the outstanding balance on your loan. Gap insurance is not required by law, but your lender may need it.

Rental Car Reimbursement

If you need to rent a car after an accident, your car insurance policy will help pay for the cost. Rental car reimbursement is an optional coverage that you can purchase with your car insurance policy. If you have this coverage, your insurance company will reimburse you for the cost of renting a car while your car is being repaired.

Collector Car Insurance

Collector car insurance covers your car for its agreed-upon value and may also cover parts and labor costs if it needs to be repaired. If you own a classic or antique car, be sure to talk to your insurance agent about getting the right coverage for your vehicle.

Roadside Assistance

There are a few different types of roadside assistance, and each one covers different services. The most basic roadside assistance plans will cover things like towing your car to the nearest service station or changing a flat tire. Some plans will also cover things like locksmith services if you lock your keys in your car.

More comprehensive plans will cover things like running out of gas or even a tow to your home or hotel if you’re stranded far from home. When choosing a roadside assistance plan, be sure to read the fine print to see exactly what services are covered.

Know What Does Car Insurance Cover

What does car insurance cover? Car insurance covers your vehicle in case of accidents, theft, or other damages. It is vital to have car insurance, as it can help cover the cost of repairs or replacements. Talk to your insurance agent to determine what coverage is right for you.

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