If you’re a first-time car buyer, the first thing you’ll need to do before you drive it off the lot is purchase car insurance.
Car insurance can feel like an unnecessary expense, which is why FreewayInsurance.com offers cheap auto insurance, but you’re not paying those monthly bills just to drive your car – you buy insurance in case anything goes wrong. When you take owning and driving a car for granted and neglect insurance, you’ll suffer serious financial (and legal) consequences down the line.
So, you need to have car insurance, but with so many types of car insurance out there, it can be overwhelming to think about. In this post, we’re going to help you out by going over different policies and what they entail. Not all car insurance is created equal, so read on and you’ll be able to get a policy that works for you.
Liability coverage is required in every state and it covers the expenses the other driver incurs after an accident. It has two main components; bodily injury liability and property damage liability.
First, bodily injury liability covers the medical costs of the other party’s injury in an accident that you’re found to have caused. Property damage liability, on the other hand, covers the costs of damage to the other person’s vehicle in the same situation.
When you have collision coverage, your insurer pays to repair or replace your car in the event of an accident with another car or any other type of collision. The payout is a max of the cash value of the car, minus your deductible.
With car ownership, you’re not required to get collision insurance, but if you’ve leased or financed your vehicle, then you’ll need to get it. Although not necessary, a car owner is advised to get collision insurance as it provides peace of mind on the road.
As with collision insurance, personal injury coverage pays for your medical bills in the event of an accident or collision. In some situations, personal injury protection will also cover indirect expenses, like lost wages or child care expenses.
This type of insurance is required in 12 states and isn’t actually available everywhere. Another type of insurance to consider along these lines is the medical payments policy. This covers the direct medical expenses of anyone within the insured vehicle after an accident.
Comprehensive insurance covers non-accident-related things like theft, hail, or vandalism. As with collision insurance, comprehensive coverage isn’t required in most places, unless you’re financing or leasing your vehicle.
If you’re buying a vehicle for your business, you may need more nuanced coverage. A business automobile policy would cover any car used for business, whether it be owned or leased by the business, or owned by an employee.
There are also industry-specific types of coverage, like the Insurance Hub car hauler policy, which covers damage to vehicles that are in transit on a hauler. If you’ve got specific inquiries about insurance for your company vehicles, it’s best to talk to an insurance agent.
Understanding Different Types of Car Insurance
Now that you know a bit more about the different types of car insurance, you can make an educated decision on what type of coverage you need and what you can leave out. The insurance industry can be tricky to navigate, but that’s why you’ve got us.
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