Most car insurance coverage is the same in each state. The difference is what each state considers mandatory coverage for its drivers. The type of liability coverage will vary from state to state but you can choose any level of coverage you wish as long as you meet the minimum for your state.
It is important to decide ahead of time if you are going to select coverage that is above the mandatory levels as this is only a part of the automobile insurance that is available to protect you and your family as well as others on the road. The amount of your deductibles and the level of coverage you choose will all have a bearing on the premiums you will pay for your automobile insurance.
Your car insurance coverage breaks down into Automobile six major areas of liability: Bodily Injury, Property Damage, Personal Injury Protection, Collision, and Comprehensive, Uninsured Motorist, and Underinsured Motorist coverage.
The insurance commissioner of each state decides what coverage you must have to drive in that state as well as the levels of coverage you must carry. Some states allow you to ensure your financial responsibility through other means but in Arkansas you must purchase insurance coverage through an Arkansas licensed insurance agent.
While the mandatory coverage required by the state is usually at the low end, you may want to consider additional coverage as well as higher levels of automobile insurance. Keep in mind that the minimum levels that are mandated by each state represent the highest amount of money that your insurance carrier will pay for medical and property damages per accident.
Your bodily injury liability will pay for the medical bills and lost wages for the person whose car you hit. It does not cover your injuries which is why you should always have Personal Injury coverage. It will cover your medical bills as well as any family members who were in the accident with you. Property Damage liability pays for the repair or replacement of property that was damaged or destroyed because of an accident where you were at fault.
Collision insurance is required on financed automobiles to protect the lender’s investment. If you let your collision insurance coverage lapse your lender will find a carrier for you and will add the price of the extra coverage to your car payment every month. You can be sure they will not shop around for the best rate.
While Collision coverage takes care of your car after an accident, Comprehensive coverage is there to protect the value of your vehicle and pay for damages that have been caused by anything other than an accident- weather damage such as flooding, if someone were to break into your car, and also if it were stolen.
While some states have no-fault laws in place Uninsured Motorist coverage and Underinsured Motorist coverage is not mandatory. Some states require you to check and initial your policy if you reject either of these forms of coverage.
Uninsured Motorist coverage will pay your medical expenses you if your vehicle is hit by someone who has no insurance coverage at all. Underinsured Motorist coverage will protect you if you were hit by a driver who didn’t have enough coverage to pay for your expenses.
If you aren’t sure exactly what you need to properly cover yourself and your family members, talk to an insurance professional and he or she will guide you through it.