Skip to main content

Auto Insurance Explained: There Are Six Distinct Coverages in an Auto Policy

By October 9, 2014May 21st, 2020Insurance
Auto insurance is a product with six distinct coverages.

Let’s examine them here:

1.      Bodily Injury Liability – This pays the medical and other expenses of those people injured or even killed in accidents you cause. The Florida minimum coverage of $10,000 for any person involved in an accident with you and no more than $20,000 for all the persons in the accident.

2.      Property Damage Liability – This covers the damage your car causes to property. Usually, that’s the other car or cars involved in the accident, but it also covers damage you do to any object you hit; garages, buildings, lampposts, fences, whatever. This is also required in most states, and Florida the minimum coverage is $10,000.

3.      Collision – This is for damage done to your car when it collides with other vehicles (your fault) or other objects (again, your fault).

4.      Comprehensive – This covers damage to your car resulting from something other than a collision with another vehicle. For example, damage caused by vandals or a wind-blown tree hitting your car. It also includes coverage for theft.

5.      Medical Payments – This pays medical, and even funeral, expenses for you as well as members of your family and passengers in your car if it is involved in a collision, regardless of who caused the accident. It also covers you as a pedestrian if a vehicle hits you.

6.      Uninsured/Underinsured Motorist – This pays for injuries to you and, in some policies, damage to your car if you are hit by a driver who doesn’t have insurance – or by someone who doesn’t have enough insurance to cover your losses. In most states, more than 10% of motorists don’t have any insurance. In Florida it’s worse, with as many as one out of four drivers not having coverage.

Many of those who do have insurance don’t have enough to cover the damages and injuries that would result in a major collision. If you don’t have this coverage, which is often referred to as UM/UIM, you are taking a risk. UM/UIM also provides coverage for any injuries you suffer if you are hit while walking or riding a bicycle by a driver with inadequate or no insurance.