Whether you’re purchasing auto insurance for the first time or you’re simply getting ready to renew your policy and are shopping around for the best price, understanding your auto insurance coverage options can seem like an insurmountable task. After all, you’ve got seemingly endless options when it comes to coverage types, coverage limits, deductibles, and so much more. Making sense of all these options, though, is extremely important to ensuring you get the best deal on your auto insurance. Here are some of the ins and outs that you need to be aware of.
Liability Limits
No two car accidents are alike, meaning that the results of any specific car accident that you’re in are totally unpredictable. Liability limits help stand in the gap of this unpredictability by offering coverage for both injuries and property damage for which you are ultimately responsible. Typically, liability limits will be listed as three numbers, such as 50/100/25.
In this example, this would mean that up to $50,000 is available for every individual who is injured. However, if multiple people are injured, this coverage is capped at $100,000. The third number, 25, indicates that $25,000 is available to cover any property damage caused during an accident. It’s important to insure with limits high enough to cover any viable scenario without the risk of you being personally responsible to pay for the damages.
Comprehensive and Collision Coverage
While liability coverage offers protection against damage that your car causes, comprehensive and collision coverage protect against damage that is caused to your car. Even if you’re in an accident that’s not your fault, you could still be on the hook for repairs to your vehicle if the other person doesn’t have enough insurance to pay for the repairs. Here, instead of selecting the level of coverage, you’re selecting the deductible that you would pay out of pocket before the coverage kicks in. The higher the deductible, the lower your premium will be.
Personal Injury Protection
If you’re hurt in an accident, it’s a good idea to have coverage to help pay for medical bills, lost wages, and the like. That’s exactly what personal injury protection is, covering costs that you may encounter as a result of injuries in a car accident, even if the car accident was your fault. Whereas your liability insurance goes toward paying for injuries to the other vehicle’s occupants, personal injury protection is in place to protect you. Depending on your state, personal injury protection may be either mandatory or optional.
Medical Coverage
Unlike personal injury protection coverage, which can be used to cover medical expenses or lost wages, medical coverage can only be used to cover things like medical costs, funeral expenses, and medical costs of any other occupants of your vehicle during the accident. These limitations make this coverage less expensive to purchase, while still providing plenty of benefits if the unthinkable happens.
What’s Right for You
Ultimately, each driver’s situation is going to be different from every other. Your typical driving location, your driving history, your vehicle, and many other factors will ultimately determine what the best coverage options are for you. As you assess your particular situation, it’s also a good idea to reach out to an insurance professional to provide solid advice on any specific needs that you have.