Everyone on the road has to have auto insurance, which makes it easy to choose a policy without really understanding what you are paying for. What does basic car insurance cover? What exactly are you paying for each month? There are some basics of auto insurance coverage that every driver should be aware of, so let’s take a look at them.
Type of Coverage
There are three main types of car insurance, each priced differently. There is liability insurance, collision insurance, and comprehensive insurance. Liability insurance covers you in the event that you are held responsible for an accident. This insurance covers repair costs, medical costs, and any loss of wages as a result of the accident.
Collision insurance covers repairs to your vehicle should you be involved in a collision. With this type of coverage, it doesn’t matter who caused the accident – your car is still covered. In addition to covering the cost of repairs, collision insurance also covers the replacement cost should your vehicle be deemed a total loss.
Finally, comprehensive coverage is just that, comprehensive. This type of coverage protects you no matter what happens to your vehicle. Whether it is stolen, damaged by a tree branch, or destroyed in a hurricane, comprehensive has you covered.
Required Coverage
Not all insurance coverage is required to operate a vehicle, however. Generally, liability insurance is the minimum required by each state to own and drive a car. Liability covers others on the road should you get in an accident. While you may not be required to have coverage for your car repairs and medical bills, you are required to have coverage for the bills you may create for others in the event of an accident.
What Auto Insurance Coverage is Right for Me?
So how do you know which type of policy you need? The type of coverage you have depends greatly on the type of car you own. Do you have a brand new car that is financed? If so, you may be required by your lender to have a certain level of insurance coverage. Is your car paid for and on borrowed time? Liability insurance may be your best option because your car will likely be totaled in the event of a crash and you can use the money saved each month to purchase a new car.
Auto Insurance Coverage from Freedom Insurance
If you have car insurance questions, the experts at Freedom Insurance can help. We offer auto insurance in Sykesville, MD and can help you decide which level of coverage is best for you. Whatever your needs are we can find a policy that meets them and puts your mind at ease. Give us a call today to get started!
