The Six Types of Auto Insurance Coverage

Property Damage (PD) Liability
This mandatory (in almost all states) coverage pays for the damage caused to another vehicle in the event of an accident in which you are legally responsible. Given the high price of many vehicles and the unknown damage you could have on public property it is a good idea to have adequate coverage here.
 
2. Bodily Injury (BD) Liability
This coverage is very important and covers payment for damages due to injury or death in an incident that you are legally responsible. While this covers medical expenses it can also be used to pay your legal defense costs. We all know how expensive medical care and legal representation can be so again, this coverage is very important.

Medical Payment 
This coverage is used to pay medical expenses incurred by you and your passengers during an accident regardless as to whether or not you are at fault. This coverage is optional in most states with a no-fault law because the no-fault coverage will pay for these expenses as well as often covering things such as lost wages tied to the accident.

Uninsured Motorist (UM) Coverage 
There is one thing you can’t control while on the road and that is whether or not other drivers are insured. While it is a legal requirement in most states to have auto insurance, there are many on the roads who drive without. This coverage protects you and your passengers in the event you are involved in an accident with an uninsured driver. Typically it covers medical expenses, but some states extend this to vehicle damage as well.

Collision Coverage
 This coverage is subject to a deductible and covers damages caused to your own vehicle in a collision. Like homeowners insurance, this coverage is generally required if you have a loan on the vehicle. When looking at collision coverage keep in mind the actual value of the vehicle that is being insured. Older used vehicles may have little or no use for collision coverage.

Comprehensive Coverage 
 In addition to collision damage, comprehensive coverage will pay for damages, subject to a deductible, from: theft, acts of nature, fire, vandalism and collisions with animals. Like collision coverage, many lenders will require comprehensive coverage on vehicles with a loan.









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