can often be like trying to
learn a foreign language. Many
find it confusing and intimidating.
Fortunately, there’s help. Here
is a quick reference designed to
help you understand some of the
most common kinds of coverages.
The reference was put together by
The Progressive Group of Insurance
Liability covers bodily injury
and property damage (BI/PD). This
covers your legal liability, up to the
dollar limits you select, for damages
caused to others in a covered vehicle
accident. In most states today,
liability insurance is mandatory.
Under BI/PD, your insurance
company pays for damages to an
injured person and for property
damage that you are legally obligated
to pay as a result of an accident.
If your policy covers you in
the event you’re sued after an accident,
your insurance company will
pay for a lawyer to defend you.
Liability limits generally appear
as three numbers, for example,
25/50/25 or 100/300/100. The first
number refers to the maximum
amount, in thousands, that your
insurance company is obligated to
pay for bodily injury per person.
The second number is the maximum
that would be paid out for
bodily injury per claim and the
third number represents the maximum
amount your insurance company
is obligated to pay for property
damage you cause.
Collision. When you buy collision
coverage, your insurance
company pays for damages if your
vehicle collides with another vehicle
or object. Collision coverage
involves a deductible amount you
select when you purchase your
policy. This amount is what you
are required to pay before your
insurance company starts picking
up the tab.
Comprehensive covers damage
caused by events other than a
car collision—such as fire, theft,
vandalism, hail or flood. It also covers
damage caused by your vehicle
colliding with an animal. And if
your car is stolen, it will cover the
cost of a rental, subject to a daily
limit. Like collision coverage, a
deductible usually applies.
Medical Coverage. Depending
on the state in which you live,
you may have available to you
Medical Payments coverage or
Personal Injury Protection (PIP)
coverage. While these both work
differently, they provide coverage
for medical care provided to you
as a result of a car accident.
An independent insurance agent
can help you determine the price,
coverage and service that best
meets your needs. To find an agent,
go to driveinsurance.com.
16 March 2009
Auto Insurance Made Easy