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The Types of Auto Insurance Coverage Available

By Compuquotes Team on March 27th, 2008
Auto Insurance

There is a variety of auto insurance coverage available from insurance companies and it can be very confusing trying to figure out what insurance you need and what you don't. Here is a description of the types of auto insurance that are available to you and some information on whether you require the insurance or not. Before we get to the descriptions, it's important to note that all of the states in the US and provinces in Canada have minimum requirements for insurance and all drivers are required to have at least the minimum of insurance for their vehicles.

Liability insurance covers damage that you may cause in an accident and is also one of the required insurances in the US and Canada at a minimum level. If you hit someone's vehicle or home, your liability insurance would pay for the damages, also if you are sued for bodily injuries of someone involved in a collision for which you were at fault, your liability insurance will cover those costs.

Comprehensive insurance covers your vehicle for damages to your vehicle that are caused by something other than a collision. This includes, fire, theft, vandalism, and impacts with an animal.

Collision insurance covers your vehicle for damages that your vehicle sustains in a collision that is deemed your fault.

Under-insured / un-insured coverage is insurance that covers you in the event that the person at fault in a collision other than yourself doesn't have enough insurance or any insurance at all. In that instance, you could try to sue for the money to replace or repair your vehicle, or to cover your medical bills and you will likely win in court, but you can't get money from someone who doesn't have any.

There are other businesses or agencies that may require you to have insurance as well. If you financed or leased your vehicle, chances are that your lending institution or your leasing company will require you to have a minimum level of insurance as well. In most cases, they require you to have a lot of insurance to fully cover damage to the vehicle to prevent loss. This insurance can be quite costly, so it's something you should consider when you are buying a new vehicle.

In some states, there is also no-fault insurance. No fault insurance means that the drivers involved in a collision do not have to prove which driver was at fault in the collision, their insurance companies each pay for their own damages and injuries. This system relieves the need for lawsuits to prove responsibility and thusly eases the burden on the court system and on the motorists. This type of insurance is highly debated, primarily because it could mean that motorists are being less careful when driving and bad drivers aren't given the blame for the accidents that they do indeed cause. This, in turn, makes the roads less safe to drive on and is the reason that many people are against no fault insurance.

Contact an insurance agent about the auto insurance coverage that you need for your vehicle, and ensure that you get a few quotes on the prices to make sure that you are getting the best price possible.

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