What Is Covered In Basic Auto Insurance Policy?

What Is Covered In Basic Auto Insurance Policy?

A basic auto insurance policy is personal liability coverage that protects you from damages caused by accident. When an accident happens, the insurance company will pay the victims or compensate for property damage on your behalf. The policy helps you to cover the costs that you could have otherwise incurred. However, you should note that the amount one can be offered is limited to a certain amount. Insurance policies may change depending on your state.
Here is what a basic insurance policy covers:

1. Personal injury liability

The policy covers treatment costs due to injuries inflicted on the passengers, and driver of the policy holder's vehicle. Personal injury liability may also provide cover for funeral expenses, medical bills, and related costs which are usually catered for by the victims of an accident.

2. Coverage for underinsured/uninsured motorists

This policy is designed to reimburse you, your family or someone driving your car when you're hit by a car driven by a driver with insufficient insurance or not insured. It also applies when you fall a victim of 'hit-and-run' accident or if you were a policyholder that's hit by an underinsured or uninsured driver.

3. Bodily injury liability

Here, you get covered for any compensation that you may need to pay for causing injury to another person. If you and your family are also included in the policy, you all get covered when driving another person's car with their permission. It's usually advisable that you buy more premiums than the state-required minimum liability coverage, so you don't use your savings or sell a property to compensate for lawsuits when you're at fault in an accident.

4. Collision liability

This auto insurance policy is meant to compensate for damages to your car due to collision with another vehicle, or when you hit a tree or run into potholes. Usually, it's sold with a different deductible. Collision liability is valid even if you're the one at fault in an accident. If you were not at fault in the crash though, your policy provider might attempt to get back their compensation from the other driver's company. If they recover the amounts, you still get compensated for the deductibles.

5. Property damage

This coverage protects the policyholder from the costs of damaging another person's properties. In most cases it will cover the damages you cause to another driver's car but may also extend to damages you cause on lamp posts, and buildings among other assets you may hit accidentally.

6. Comprehensive

In this coverage, the policyholder is compensated for any loss due to damage from theft, vandalism or any natural calamity, and not collision. It also pays you when your car gets intact with deer. Comprehensive liability will also cover for the replacement or repair of your windshield. It's usually sold with different deductibles. Some insurers will, however, give the glass protection coverage minus the deductibles.
Finally, if you're are ready to buy your auto insurance policy, it's vital that you only select a good provider. Before signing on the dotted line, be sure to read and understand all the laid down terms and conditions.