• 5 Types of Auto Insurance Policies

    There are several different kinds of auto insurance policies; probably more than you ever knew existed. Understanding the different kinds of auto insurance policies can help you decide if you need the coverage or not. Not all coverage is for everyone. Some people look for specialty coverage while others are happy with the simple liability coverage required by most states. The most common five types of auto insurance policies are bodily injury, uninsured motorist, collision coverage, property damage, and GAP insurance.

    Bodily Injury

    Bodily injury is the amount of coverage that covers medical care for people that are in the other vehicle when you are found at fault in the car accident. Most people have bodily injury in their auto insurance policies. The insurance is usually covered per person for a total amount per accident. For instance, your coverage may cover $100,000 per person for a total of $300,000 for the entire accident.

    Uninsured Motorist

    Uninsured motorist insurance will protect you if you are hit by another motorist that does not have insurance. Your insurance company will now pay for property and bodily injury considering that the other person did not have the required insurance per state laws. Even if the motorist did have some kind of coverage but it was not enough, then your insurance will pay the difference. As the economy slows down this may become more important. More and more people need to cut costs somewhere and some may be opting out of or unable to pay for the required state liability insurance.

    Collision Coverage

    Collision coverage will require you to pay the defined deductible. After the deductible is paid, the insurance company will cover the property damage to their own vehicle. Collision coverage will pay for the repair or replacement of the vehicle up to the worth of the vehicle or the insurance coverage.

    Property Damage

    Most states do require some kind of property damage insurance. Property damage insurance will cover the cost of damaged property caused by you in an auto accident. It will cover both the other person’s vehicle and any other property involved.

    GAP Insurance

    GAP insurance is specialty insurance and is not required. It can be added to your policy if you desire. Often banks will suggest you obtain the insurance to protect you and the loan they are giving you. GAP insurance will essentially cover you for the total amount of your loan versus the value of your vehicle. This will protect you against negative equity in your vehicle. If an accident should occur and the car is a total write-off, the car insurance company will only pay you for the value of the car and you are left to pay the difference to the bank. Obtaining GAP insurance can protect you from this issue that is very common among car owners.

    These are only a fraction of the kinds of auto insurance policies that are at your disposal. Contact your agent today to see what they have available in their company for you. If you are looking for a car insurance company then make sure you explore all of your options when obtaining your quotes.