Auto Insurance Basics...

A standard auto policy is made up of several types of coverage. Each of these coverages has its own separate premium.

Bodily injury liability provides protection if you injure or kill someone while operating your car. The type of car you drive has little bearing on the amount of coverage you should have. In the event of a serious accident, you should have enough insurance to protect assets that may become subject to a lawsuit. This coverage is legally required.

Property damage liability pays for damage you cause to someone's property and also provides you with legal defense. This coverage is legally required.

Medical payments, no-fault or personal injury insurance usually pays for the medical expenses of the driver and passengers in your car in the event of injury (up to the specified limit you choose) no matter who was at fault.

Uninsured motorist coverage (BI and PD). Uninsured motorist bodily injury (UMBI) coverage pays for injuries to you or to persons in your car in accidents caused by uninsured or unidentified drivers. The law requires that this coverage must be offered with liability insurance. If you reject it, you must do so in writing. Uninsured motorist property damage (UMPD) coverage pays for damage to your car caused by an identified uninsured motorist.

Comprehensive insurance (A component of physical damage coverage) pays for damage to your car caused by reasons other than collision, such as fire, theft, windstorm, flood, etc.

Collision insurance (A component of physical damage coverage) pays for damage to your car caused by a collision with another vehicle or with any other object, regardless who was at fault.

Rental car reimbursement helps pay the cost of renting alternate transportation if your auto is disabled in an accident for more than 24 hours.