What Does Car Insurance Really Cover? A Breakdown of Common Coverage Types

Understanding what your car insurance covers is crucial when choosing the right policy. Here’s a breakdown of the most common types of coverage:

1. Liability Coverage

This is often required by law and covers damages you cause to other vehicles or property in an accident. It also covers medical expenses for others.

2. Collision Coverage

This covers the cost of repairing or replacing your car if it’s damaged in an accident, regardless of who’s at fault.

3. Comprehensive Coverage

This type of insurance covers non-collision incidents like theft, vandalism, natural disasters, or hitting an animal.

4. Personal Injury Protection (PIP)

PIP covers medical expenses for you and your passengers, regardless of who is at fault. It can also cover lost wages due to injuries.

5. Uninsured/Underinsured Motorist Coverage

This coverage protects you if you’re involved in an accident with someone who doesn’t have insurance or enough coverage to pay for your damages.

Understanding these coverage types will help you select the policy that best meets your needs.