Car Insurance: What's Covered?

Car insurance (also known as auto insurance, motor insurance or vehicle insurance) is insurance that is purchased for trucks, cars and other motor vehicles. It is primarily used as protection against losses that may have been incurred resulting from a traffic accident and also protects against liability that could possibly be incurred in an accident.

A car insurance policy can cover, but does not have to include coverage for six different risks, each one that is priced separately.

Property Damage, Bodily Injury and Other Basic Car Insurance Coverages

1. Property Damage. Covers you in case your car damages another’s property. Typically, it is a car, but is sometimes it is a house, fence or other type of property. This coverage also provides legal defense in case someone files a suit against you.
2. Bodily Injury. Cover’s the injuries or death to others in which you are responsible for; covering injury to a person and not a vehicle. This coverage also provides legal defense. Claims for bodily injury may include particular things such as loss of income, medical bills or pain and suffering.
3. PIP (personal injury protection). Covers injuries to the driver and passenger in the policyholder’s car.
4. Collision. Covers damage to the car of the policy holder.
5. Comprehensive. Covers the car of the policy holder that does not involve an accident with another car, typically including theft, fire, falling objects, earthquake, flood, missiles, civil commotion and riot.
6. Uninsured motorists. Covers the injuries of the policyholder when in an accident with another driver who is not insured.

What is car insurance umbrella coverage?

Umbrella insurance is an additional product that pays over the existing car policy. It can be used to cover gaps in coverage for events that may not be covered under the current policy. Coverage is usually available at $300,000, $500,000, $1million and $2million with premiums that are set based on the coverage selected.

What is commercial auto liability coverage?

Commercial auto liability coverage offers protection for vehicles that are commercial or business-owned. This coverage protects a business’s assets in case of an accident while driving the vehicle. The policy will include damage and collision as well as personal and property damage.

Does my policy cover anyone who drives my car?

Usually, insurance will cover a car first and then the driver second. If someone else is driving that you have given permission to, the car and person will generally be covered with your coverage. There are times when insurance companies will not cover particular drivers for certain reasons, so it is best to contact your insurance company to verify if someone will be covered.

Does my car insurance policy cover me while driving someone else's car?

Typically your car insurance will not cover you while driving someone else’s car, but there are some cases when it is used as a secondary or even excess insurance when the primary insurance in not enough.