Most parts of the United States have passed minimum auto insurance coverage legislation. All drivers in the state must maintain at least this level of protection in place to stay legal and insurance companies licensed to sell policies in the state must provide quotes for this level of coverage (or higher) to prospective buyers.
The state minimum will likely include bodily injury and property damage. Both of these types of protection are put in place to protect the occupants of the other vehicle when an accident occurs. Bodily injury liability coverage pays for medical bills and rehabilitation expenses for accident victims. It also covers economic loss stemming from the accident. Funeral expenses are also included in this type of coverage.
Property damage coverage is used to pay for the cost of repairs to the other driver’s vehicle, as well as public property damaged or destroyed in the accident.
A state’s minimum auto insurance coverage requirements may also include uninsured and underinsured motorist protection. Uninsured motorist coverage pays for medical bills and economic loss incurred by the policyholder and the occupants of his or her own vehicle when the at-fault driver does not have coverage. Underinsured motorist coverage pays the difference between the at-fault driver’s available coverage and the amount of damages payable.
In a no-fault car insurance state, Personal Injury Protection (PIP) coverage may be required by law. This iis the coverage used to pay for the policyholder’s own injuries and economic loss.