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What are the different types of automotive insurance coverage?

By Bill

Owning a car is a necessity for many, but is also a huge financial risk. Car ownership exposes you to risks from several different kinds of liability and losses. People tend not to think about such things when buying a new car but you should know your car can get stolen, it could crash or you could, through some mistake of your own, cause damages to another individual’s property or person and hence be considered liable for any damages caused. Hence, if you plan on owning a car, you should also be thinking about the kind of automotive insurance coverage you should seek for your car.

Auto insurance starts with what is called base coverage. The kind of insurance you should choose depends on any risk factors you and your automobile are most exposed to. For example, if you live in an area with a lot of crime, it would be prudent to have your car insured against theft. On the other hand, if your area has dangerous roads or traffic, it is best to have your car insured for collision coverage. Listed below are the different kinds of automobile insurance coverage that car owners can get in the United States:

Liability Coverage

Liability coverage can be divided into two categories, coverage for bodily injury or coverage for personal property. In most states, there is a legal requirement for car owners to have a minimum amount of liability coverage. In other cases, individuals buying a car can post a bond to register their vehicle or obtain a driver’s license. If the car owner finds themselves in a situation where they are legally responsible for damages to another person’s property or person, then liability coverage will assist in covering those damages. Since liability coverage is a legal requirement for owning and driving a car in most states, insurance policies which cover other kinds of losses are usually an addition to the preexisting liability coverage.

Collision Coverage

In cases where liability cannot cover all the costs of car repairs resulting from a crash, having collision coverage will ensure that funds are allocated to the cost of repairing your car. If your car has been damaged to the extent that it cannot be salvaged, then a collision coverage policy will pay you back the value of the car, within specific guidelines. Collision coverage is essentially to minimize the financial loss you take as a result of the damages to your own property. As such, they are more important for newer and more expensive cars. Owners of older cars can also benefit from collision coverage but it is not always necessary for dated models, as the payout they require is significantly smaller than for new vehicles.

Comprehensive Coverage

Traffic accidents aren’t the only danger to cars. When certain situations outside the control of the car owner or driver are involved, such as bad weather, animal crossings or theft, then some kind of insurance policy covering these situations is needed. This ensures that your car has coverage even for damages which are not a direct result of a car crash. This kind of policy is usually more expensive and is not in everybody’s financial reach. In certain cases, the installation of certain items to your car will reduce the cost of the premium you will have to pay for this kind of insurance. For example, having a tracker installed in the car will reduce the amount you will need to pay in premiums for theft insurance.

Personal Injury Policy Protection

Medical bills for injuries sustained as a result of car accidents tend to be very expensive. Personal injury policy protection agrees to cover the cost of medical care for the driver of the car along with the other passengers, and guarantees coverage, no matter who was at fault in the car accident. This is a very beneficial policy to have and can save the car owner a lot of money and further potential lawsuits from the passengers of any other vehicles involved. Unfortunately, this kind of insurance policy is not available in all states.

Uninsured or Underinsured Protection

Even though state laws require that all car owners have some kind of minimum coverage, there are still a lot of uninsured drivers on the roads. A great many, if not most drivers, only buy the bare minimum amount of insurance that they are legally supposed to buy. In many cases, coverage like this does not cover all the damages caused in a collision. This would mean that if such a person was in a car accident, and the other party received property damages and injuries, then their coverage would not cover all of the other party’s damages. This is why uninsured and underinsured protections exist. In the event that the driver’s coverage policy was insufficient, the remaining damages can be paid by an underinsured protection policy.

Expert Witness for Insurance

In certain cases, a traffic collision case can keep going to the extent that eventually a judge or jury will have to step in. In these cases, having an expert witness on your side can mean the difference between winning and losing a case. Expert witnesses are professionals with extensive experience and knowledge about insurance policies and the stipulations that surround them. Their knowledge would also include the specific laws and regulations regarding auto insurance in the state you live in. Insurance can be a complicated and murky area of law that is difficult for the layman to navigate through. Having an expert witness at your side can make it much easier for you to convince a judge and/or jury that you as a policyholder were not at fault for the accident or that you deserve to be compensated by the other party or your insurance coverage. This isn’t a formal insurance policy per say like the other policies listed above. Instead, expert witnesses can be hired for a fee. You then inform the witness as much as you can about the accident and he or she then supports your case in court.

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