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Most Common Types Of Auto Insurance Explained

In 2021 alone, approximately 42,915 people died in car crashes, with another 4.8 million being injured. With such devastating consequences, the last thing you want to worry about is being unable to pay for car repairs or medical bills if you’re injured in a crash. 


This is why having the right insurance coverage is so important. In this guide, we will discuss the most common types of auto insurance, so you can make sure you’re properly protected.


Liability Coverage

Liability coverage pays for the damage caused by an accident that is your fault. It covers damage to other people’s property (including their cars) and may also cover medical costs if someone else was injured in the accident. Most states require drivers to carry some kind of liability coverage.


Collision Coverage

Collision coverage pays for repairs to your car if it’s damaged in an accident, regardless of who is at fault. This type of insurance may also cover the cost of renting a car while yours is being repaired. Collision coverage typically comes with a deductible – the amount you have to pay out-of-pocket before the insurance company will cover any damages.


Personal Injury Protection (PIP) 

Personal injury protection (PIP) covers medical costs associated with an accident, as well as lost wages and other expenses related to an injury suffered in a crash. It also covers injuries sustained by you or any passengers riding with you, regardless of who is at fault.


Comprehensive Coverage

Comprehensive coverage pays for damage to your car due to non-collision events such as theft, vandalism, floods, and fires. It may also provide rental reimbursement, depending on the policy. Like collision coverage, comprehensive coverage usually comes with a deductible.


Medical Payments Coverage

Medical payments coverage pays for medical bills related to an accident, regardless of who is at fault. It may also cover funeral costs and other expenses associated with an injury suffered in a crash.


Other Types Of Auto Insurance Coverage

In addition to the categories above, there are several other types of auto insurance coverage that provide additional protection:

  • Rental reimbursement coverage: covers the cost of renting a vehicle while your car is being repaired
  • Gap coverage: pays the difference between the amount owed on a car loan and what your insurance company will pay if your vehicle is totaled
  • Towing and labor cost coverage: covers towing costs and roadside assistance
  • New car replacement coverage: provides for the full value of a new vehicle if yours is written off due to an accident
  • Ride-sharing coverage: provides extra protection when you’re driving for ride-sharing services like Uber or Lyft
  • Classic car insurance: this type of auto insurance provides specialized protection for vintage cars

Need Help? Bethany Insurance Is There

Finding the right car insurance can be a challenge. That’s why Bethany Insurance is here to help. We offer personalized coverage options and will work with you to ensure your policy meets your needs and budget. Contact us today for more information or to get started on your car insurance!