Getting to Know Your Car Insurance

Car insurance policies can make very complicated reading, and sometimes you can feel as if it’s quite beyond you. So it’s a good idea to learn the meaning of some of the key terms first, and this will make the policy a lot easier to understand. Terms, for example, such as property injury liability, collision, comprehensive, and bodily injury liability, are basic to understanding car insurance.

Collision Coverage

If you are in an accident, and you need replacements or repairs to your car or to someone else’s property, then collision coverage is for you. You can lower your premiums by increasing your deductible, so plan ahead in case you are at fault in an accident, and know how much your deductible is. Work out how much you will be able to afford for repairs after an accident out of your own pocket, and have your deductible set at that amount. If there is an accident, you will pay this amount and the insurer will cover the rest.

Comprehensive Coverage

You need to be very clear about just what this important term means. This is your protection against theft, vandalism, fires, some natural disasters, and so on. Again, as with collision coverage, there is a deductible set which is the amount you will pay out of your own pocket, and again the higher it is, the lower your premium.

Liability Coverage

This is a useful type of coverage
to have if you are at fault in an accident, for example if you try to brake and instead hit the gas, and damage someone’s property. Liability coverage will cover the cost of the damage, and in some cases it will also cover personal injury expenses.

Bodily Injury Coverage

This type of coverage is essential, in fact mandatory in some states. If you are at fault in an accident in which the other party is injured, then you are liable for medical costs, as well as possible loss of earnings. This could be a great deal of expense, which bodily injury coverage will protect you against, and it will also help if you are faced with legal action.

Property Damage

This is part of liability coverage, and protects you against the costs of damaging someone else’s property. Imagine if you smashed into a house, and how much expense you could be liable for. Therefore you definitely should have property damage coverage
, which will also help you in the case of legal action.

Each car insurance policy offers its own level of coverage, and none of them are perfect. But if you are aware of the basic types of coverage and why they are important, this will be of great help to you in making your decision.

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