Financial requirements can be a little overwhelming for a first-time car buyer. Getting a car loan is a strenuous enough process. But, most states also require you to have car insurance coverage, too.
Many people focus so much on car essentials that they struggle when it comes to car insurance. Often, first car buyers have no idea how to distinguish between the different types of car insurance plans.
Fortunately, you don’t have to face this challenge alone! Instead, check out our guide to the different types of car insurance plans. We’ll help you find the best insurance for your purposes.
Table of Contents
Liability Coverage
Most US states require drivers to have liability coverage for their vehicles. This type of insurance helps you cover damages for injuries and property damage that you become legally responsible for.
Finding the best car insurance plans for liability coverage can take some research. One helpful way to start is by researching what conditions they’ll cover.
Sometimes, your actions may not qualify you for insurance coverage.
In many cases, liability insurance is what the state requires you to have for traffic violations. This requirement makes it the necessary type of insurance for SR22 compliance.
Collision Insurance
Collision insurance provides specific coverage for damages caused by colliding with another vehicle. These insurance policies may help you repair or replace your vehicle with the appropriate coverage.
Please note that this insurance only protects vehicles from collision damages. There’s a more all-encompassing version of this insurance in the next section.
Comprehensive Insurance
Comprehensive insurance offers extra coverage for accidents involving another vehicle. However, it also provides financial compensation for damage caused by other factors.
Some of these factors include:
- vandalism
- inclement weather damage
- accidents involving animals
Comprehensive insurance provides more coverage than collision policies. It’s often best to get this policy if you worry that collision insurance won’t be enough.
Uninsured Motorist Insurance
Just because you follow the law doesn’t mean everybody else does. You may end up in a collision with somebody without car insurance. When this happens, their insurance cannot cover the damages to your vehicle.
That’s why uninsured motorist insurance exists. This coverage can protect you and your car from uninsured drivers.
It can also cover damages caused by a hit-and-run accident. This scenario is identical to having an accident with an uninsured driver.
Personal Injury Protection Insurance
Personal injury insurance protects drivers from medical expenses and income loss caused by your accident. Some policies cover as much as 80% of your medical bills in these cases.
The insurance policy may cover other expenses, too. But, please note that these only cover expenses caused by covered accidents. Your incident may not qualify for coverage from your policy provider.
Find the Best Types of Car Insurance Plans for Your Needs
As you can see, several types of car insurance plans exist for drivers. All you have to do is decide which coverage seems most important.
Legally, drivers must have liability insurance at the bare minimum. But, you can also pair this coverage with more extensive plans. So, search the types of insurance to see what bundles you can create!
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