Navigating the world of car insurance can be a daunting task whether you’re a new driver or a seasoned car buyer. Determining the right amount of car insurance coverage involves evaluating various factors, like your state's minimum requirements, the value of your vehicle, and your personal financial situation. Car insurance policies consist of several components, and understanding them is vital for making informed decisions about your coverage. In this article, we’ll provide an overview of auto insurance coverage so you can understand how much you need and find a policy that’s right for you.
How much car insurance do I need?
The amount of car insurance “needed” will vary from person to person, but whether you’re driving a brand-new car or an older model, you’ll want to make sure you’re covered in case an accident happens. Our auto coverage quiz can help you get a better idea of how much coverage might be right for you. If you’re still confused, have a few questions, or are ready to start looking at coverage options, we can help you with the leg work and compare quotes from some of the most trusted insurance companies in just minutes. Shopping for car insurance doesn’t have to be time-consuming or overwhelming—let us help.
Understanding Your Auto Insurance Policy
Understanding your auto insurance policy is crucial for ensuring you have the right coverage in place to protect yourself and your vehicle in the event of an accident or unforeseen circumstances. Familiarizing yourself with the different types of coverage can empower you to make informed decisions about your coverage and financial protection. The six basic types of car insurance include:
Bodily Injury Liability: If you’re at fault in an accident, bodily injury liability should cover medical, rehabilitation, and funeral expenses sustained by all injured passengers, including those not in your car. This plan should also pay your legal and settlement fees if a lawsuit occurs as the result of an accident that you caused.
Property Damage Liability: Like bodily injury liability, this coverage kicks in when you’re at fault for an accident. Property damage liability covers parts and labor for car repairs, property inside the other party’s vehicle, and any items you may have hit. While this plan will also pay certain legal expenses, it typically does not cover damages to your own vehicle or property.
Personal Injury Protection (PIP or No-Fault): Regardless of who is at fault in an accident, PIP covers most medical expenses—including hospital, rehabilitation, and in-home assistance costs—along with lost wages and funeral expenses incurred by you and your passengers. Certain states will require personal injury protection in addition to other types of coverage.
Uninsured/Underinsured Motorist Protection: If you’re hit by a driver with either no or inadequate coverage, uninsured/underinsured motorist protection will help pay for the rehabilitation, medical expenses, and funeral costs incurred by you and any other passengers in your vehicle. It can also help pay for the settlement of any lawsuits caused by an uninsured, underinsured, or hit-and-run driver. Some states will require this type of coverage, while others consider it optional.
Collision: This type of coverage pays for the repair or replacement of your vehicle, up to and including your vehicle’s cost, if it's damaged in a collision with another automobile or object, regardless of who is at fault.
Comprehensive: A comprehensive plan typically covers damage to your car from an event that’s out of your control, such as a natural disaster, theft, vandalism, or other unpredictable events.
Let SelectQuote Help You Find the Policy That Fits Your Needs
Whether you’re looking for liability or comprehensive auto insurance coverage, we can take the hassle out of shopping for a policy. In just minutes, our licensed insurance agents will get to know your needs and can share unbiased quotes from several of the most highly trusted carriers in the nation. With nearly 40 years of experience, we’ll help you find the coverage you need at a price that works for your budget.
