8 Types of Car Insurance Explained

State Minimum Car Insurance

¹ Required in most states. ² Required in certain states. Some states offer as optional insurance.

¹ Bodily Injury Liability

Bodily injury liability coverage pays for another person’s medical or funeral expenses (not yours) if you cause a car accident. It may also cover your legal costs to resolve a personal injury lawsuit if needed.

¹ Property Damage Liability

Property damage liability coverage pays to repair or replace another person’s property (not yours) if you’re responsible for a car accident. Typically, it covers damage to the other driver’s vehicle and someone else’s property.

² Personal Injury Protection

Regardless of who is at fault, personal injury protection, or PIP, helps pay for bodily injuries that you and your passengers incur in an accident. It can cover medical, hospital, and funeral expenses, lost wages, and childcare services.

¹ Uninsured Motorist Coverage

Uninsured motorist coverage pays for your expenses if you’re hit by an uninsured or underinsured driver. Depending on the state, it may offer two types of protection; bodily injury to pay for medical bills, and property damage to pay for damages to your vehicle.

Car Insurance to Protect Your Car

*Often required by a lender or bank if car is leased or financed. These coverages almost always include a deductible.

Collision

Collision coverage pays to repair or replace your vehicle if you collide with an object like a car, tree, or guardrail. It also covers your car if it overturns in an accident or is involved in a hit-and-run.

Comprehensive

Comprehensive coverage, also referred to as “other than collision coverage,” pays for vehicle damage not caused by a collision. For example, it can cover damage to your vehicle from weather conditions or natural disasters, falling objects, vandalism, fire, or theft.

Optional Coverages

*May be added to a car insurance policy for more financial security.

Medical Payments

Medical payments coverage pays for you and your passenger’s medical costs, including ambulance bills, hospital bills, or funeral expenses in the event of a covered car accident, regardless of who is at fault.

Towing and Labor

Towing and labor coverage added to a policy with comprehensive and collision insurance covers emergency towing costs due to a mechanical breakdown or an accident, and any necessary labor costs and services at the place of breakdown.