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Understanding Auto Insurance Coverage Better


Provisions in the policies of auto insurance of car owners are absolutely necessary and crucial. Other provisions might be beneficial and somehow desirable. A few of these, however, are just plain unnecessary.

The first thing that car owners should think about when getting an insurance coverage or policy is the protection of his or her assets and family.

Majority of States actually require bodily injury liability insurance coverage to take care of the medical treatment of people involved in accidents. It also includes expenses for rehabilitation, and for unfortunate instances, like funeral costs. This coverage is applicable to passengers who are together with the policy holder, drivers together with any other people, and people who are directly involved with the accident including pedestrians and bystanders. Other costs that are shouldered by this type of coverage or policy are fees of any legal representatives and losses with no values like physical and emotional pain.

The minimum coverage that a State requires is low. With its current value, it cannot effectively protect the interests of majority of the motorists or vehicle owners. Unless income and asset constraints are present, the recommended coverage to be obtained is said to be at least $100,000 for each person. In addition, $300,000 per accident is also considered.

Property damage liability, on the other hand, shoulders repairs or replacements done on the properties of other people including the vehicle of the other party. The minimum values per state vary, but the average is about $15,000. However, cars these days are pegged at an average of $25,000. It is advisable that $30,000 in coverage is obtained.

During times when hit-and-run encounters happen, an auto insurance coverage called uninsured motorist or underinsured motorist solves this problem. It is also responsible for covering excess costs that the offending party has done (during times when coverage of the offending party is insufficient). As with the first mentioned coverage, it pays for medical costs or funeral expenses incurred to people in the vehicle of the affected party. This kind of coverage insures household members of policyholders as pedestrians. It is advised that this kind of coverage be bought with the same amount as with bodily injury liability coverage.

Personal injury protection is more commonly known as PIP and “no-fault.” As with the aforementioned coverage, it also shoulders the different expenses associated with household members and can include lost wages and home care services. This can be bought at a minimum except when health and disability coverage policies of the insurance are reduced.