Typical Auto Insurance Coverage for Consumers

What does a typical auto insurance coverage package look like? The exact level of coverage will vary, depending on the driver’s age, budget and the number of assets that he or she needs to protect. A basic auto insurance policy will include liability and physical damage coverage.

Liability insurance is put in place to protect the occupants of the other vehicle in an accident. It includes bodily injury liability protection, which pays for personal injury claims. A person who has been injured in an accident can seek compensation for medical bills, rehabilitation costs and lost wages. In some states, the injured person can also make a claim for lost wages incurred as the result of an accident.

Physical damage coverage includes collision and comprehensive protection. Collision coverage pays for damages to the policyholder’s own vehicle due to an accident resulting from striking an object. It also pays out for a rollover accident. Comprehensive insurance pays out when the loss is due to an event other than a collision, such as fire, vandalism, falling objects and theft. The policyholder will need to pay a deductible before the insurance company will write a check to settle a claim on this type of coverage, though.

A typical auto insurance policy may also include uninsured and underinsured motorist coverage. Uninsured motorist coverage comes into play when the at fault driver in an accident either does not have any coverage or cannot be identified, such as in the case of a hit and run accident. Uninsured motorist protection is used when the at fault driver does not have enough coverage to pay for the damages caused in the accident.