Basic automobile insurance coverage pays for the other driver’s vehicle and injuries. This is your automobile liability insurance. If an at-fault driver hits you and has insurance on his car, his liability coverage pays for your car repairs. If he has no insurance, your uninsured motorist property damage policy covers your vehicle. If you have an accident with another vehicle that is your fault, you must have collision coverage to repair your car.
If you have any automobile insurance, you have liability coverage. Your insurance pays for the other driver’s car and injuries if you are at fault, and his insurance pays if he is at fault. Because not all drivers have insurance, and many drivers carry the minimum limits the state allows, you may need more insurance than just liability coverage.
Comprehensive and Collision Insurance
If you have a lien on your vehicle, you must carry comprehensive and collision insurance because your car is security for the loan, and the loan company would not want to hold a lien on a wrecked car. Collision insurance pays if you have an accident that is your fault. Comprehensive insurance covers the loss of your car to theft, falling objects or just about anything that is not a collision. If you want your insurer to pay for your car repairs, collision and comprehensive are necessary coverage. This coverage has a deductible, so you are not covered 100 percent. The insurer states the deductible on the declarations page. Your insurer only pays for repairs or actual cash value of your vehicle if it is totaled -- not replacement cost.
Uninsured Motorist and Uninsured Motorist Property Damage
Uninsured motorist coverage pays bodily injury and property damage claims for you, your passengers and your vehicle if the other driver has no insurance. Uninsured motorist insurance also covers hit-and-run accidents. Underinsured motorist coverage pays if the other driver has minimum insurance but not enough to cover your vehicle or injuries. Uninsured motorist covers your vehicle only if the other driver is uninsured or unknown.
Unless you have a luxury vehicle, your car repairs are a minor part of automobile insurance, yet they account for 40 percent of your insurance bill, according to a 2009 article by Jerry Edgerton at Cars.com. Personal injuries and medical care can be a greater expense. Most buyers drop collision and comprehensive insurance when a car is several years old, leaving themselves with no insurance for vehicle repairs for an accident that is their fault.
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