The 4 Kinds Of Auto Insurance And Why You Need Each

When you pay your car insurance premiums, you probably don't give much thought to just what types of coverage you have when behind the wheel. However, that will not be the case if you are involved in an accident. Depending on the type of accident that you find yourself in, the seriousness of your injuries and damage to your vehicle, and other circumstances, your car insurance can be critical in not only getting your car back on the road, but also helping to pay your medical bills. Should you be shopping for car insurance, here are the four basic types and why each one is important.

Liability

An insurance policy that is mandatory in most states, liability coverage is composed of bodily injury and property damage liability. Bodily injury helps pay costs related to another person's injuries if it is determined you were the one who caused the accident. Property damage coverage will pay for any damages you cause to another person's property when involved in an auto accident.

Uninsured and Underinsured

When discussing auto coverage with folks at Mike Pierce Insurance, pay close attention to what they tell you regarding uninsured and underinsured motorist coverage. Should a driver who does not have auto insurance crash into you, uninsured coverage will pay for your medical bills and perhaps your vehicle repairs. If a driver who has insurance but little in terms of liability coverage hits you, underinsured coverage will help pick up the tab.

Comprehensive

A very important type of auto insurance coverage, comprehensive coverage will kick in if your vehicle is damaged from such things as fire or hail, or if your vehicle is vandalized and sustains substantial damage. This coverage will help to not only repair your vehicle, but also to perhaps replace it if it is a total loss. However, remember that it will only pay you the equivalent of your vehicle's actual cash value at the time of your accident.

Collision

Should you hit another vehicle or perhaps hit a fence or other object, collision coverage will help to repair or replace your vehicle if needed. Like comprehensive coverage, collision coverage has a deductible, and will only reimburse you up to your vehicle's actual cash value, minus your deductible.

A necessity when on the road, auto insurance can be a key factor in helping you weather the financial storm following an accident. If you have questions about the types of coverage you need, never hesitate to speak with a qualified insurance agent.