How does your coverage impact your car insurance?
Car insurance coverage can be divided into two primary categories: liability and physical protection. Liability coverage protects other drivers and their property from damage you cause. Physical coverage, i.e., collision and comprehensive, protect the physical integrity of your vehicle.
Depending on your state, your liability requirements will change. Generally, you’re required to carry bodily injury and property damage liability coverage.
$30,000 in bodily injury coverage per person
$60,000 in bodily injury coverage per incident
$25,000 in property damage per incident
If you live in a no-fault insurance state, you’re also required to carry personal injury protection (PIP). A no-fault state means every driver is required to cover their own bodily injury damages after an accident — regardless of fault. PIP covers personal bodily injury and medical costs after an accident.
For more information on insurance coverages, see our related articles below:
Your physical coverage — collision and comprehensive — is designed to protect your vehicle from damage.
Your collision coverage protects your vehicle if you collide with another object or vehicle. Collision coverage comes with a deductible — what you pay prior to your insurance company compensating you. Your deductible may vary depending on your and your insurance company’s preferences.
Your comprehensive coverage works to protect your vehicle from circumstances other than a collision. Damage caused by weather, animals, theft, and vandalism is covered by comprehensive insurance. Like your collision protection, your comprehensive coverage also features a deductible.
For more information on physical coverage, see our additional articles below.
Liability, collision, and comprehensive are the most popular insurance coverages because they’re required by your state, whether you’re leasing or financing a vehicle, but there are other coverages you can buy as well. Below are some additional resources regarding car insurance coverage.
Want to know what isn't covered by insurance? Then check out our guide on car insurance exclusions.
Lastly, there are some unforseen circumstances that may or may not be covered by insurance. Below are some of the most common types.