What are the various types of auto insurance coverage?

The standard private passenger automobile insurance policy affords up to four types of coverage.  These coverages include: Liability Coverage, Medical Payments Coverage, Uninsured Motorist Coverage (Underinsured Motorist Coverage) and Coverage for Damage to Your Auto (Comprehensive and Collision).

Liability coverage protects you from property damage or personal injury claims arising out of the ownership, maintenance or use of a covered automobile.  Unless specifically restricted by your policy, you will have coverage while driving any car, pickup, or van so long as you have the owner’s permission to use the vehicle.  A person who is using your car, pickup, or van with your permission will also be covered.  At the time the policy is issued you will choose the limits of liability that you want.  The limits that you select are the most that we will pay in the event of a loss.

Medical payments coverage pays for medical expenses that you, or a family member, incur as the result of an automobile accident.  It also covers persons who are occupying a covered automobile.  At the time the policy is issued you will choose a coverage limit.  The limits that you select are the most that will be paid for each person in connection with a single accident.

Even though liability coverage is advisable and often required, there are many irresponsible people who do not buy insurance.  If an uninsured motorist causes an accident you will not be able to recover any damages that you sustain.  If you purchase uninsured motorist insurance, though, your insurance company will pay you for the property damage and bodily injury caused by an uninsured motorist.  It will cover you, any family member, and anyone occupying a covered automobile.  The limits for this coverage are usually the same limits that you selected for liability, although you can choose lower limits.

There are also times when a person who causes an accident has liability insurance but your damages exceed the limits of that person’s coverage.  In some states underinsured motorist coverage is included in your uninsured motorist coverage.  In other states, you can purchase underinsured motorist insurance which covers your excess losses up to the limit set forth in the policy.

If you have comprehensive and collision coverage, the insurance company will pay for damage to a covered automobile regardless of fault.  Most banks and finance companies require you to maintain comprehensive and collision coverage on your car if it is financed.

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