The Eight Main Types Of Car Insurance

Car insurance won't prevent you from being involved in an accident, but it can help cover medical and repair costs afterwards. How much your policy will pay depends on the type of car insurance coverage you buy and the limits you choose.

The following is a guide on the most common types of car insurance, what they pay for, and when you might need it.

Eight types of car insurance (plus 1)

Liability insurance

Personal Injury Protection

Medical payment coverage

Uninsured motorist insurance

Insurance of insured motorists with low coverage

Collision coverage

Comprehensive coverage

GAP insurance

Other types of car insurance

Liability insurance

If you cause a car accident, your liability insurance will cover the cost of billing the other driver for damage, injury, or even death. Almost every state requires this coverage for all drivers, and you'll need proof of insurance to legally drive a new vehicle.

There are two types of liability coverage:

Bodily injury liability covers the medical costs of an accident.

Property damage liability covers the cost of repairing other vehicles, fences, post boxes, or buildings as a result of an accident.

Your car insurance may only pay up to the limit stated in your policy, and then you are responsible for the additional costs of the accident. So, if property damage reaches $52,000 and your liability insurance covers $50,000, you need to pay the remaining $2,000.

Personal Injury Protection and medical payment coverage

Personal Injury Protection, or PIP, and medical payment coverage, or MedPay, cover your medical expenses after a car accident, no matter who is at fault. They also cover medical expenses for injured passengers if you are the guilty driver.

Personal injury coverage, sometimes called no-fault insurance, can also cover funeral expenses, childcare, or lost income as a result of injury from an accident. PIP or MedPay is required by law in 17 states without error

Uninsured driver bodily injury coverage, or UMB, pays for medical expenses caused by uninsured drivers.

Uninsured driver property damage coverage, or UMPD, pays for repair costs caused by uninsured drivers.

Limited insured driver bodily injury coverage, or UIMBI, pays out if the injury and repair costs are more than the culpable driver's bodily injury liability limit.

Limited insured driver property damage coverage, or UIMPD, pays for repair costs that exceed the culpable driver's property damage liability limit.

Collision and comprehensive coverage

Collision and comprehensive insurance are optional in each state, but may be required in certain situations, such as if you are financing or leasing your vehicle. The limits on this type of coverage are the value of your car at the time of the accident, and those limits pay to repair your car or pay its value if the car is stolen or damaged beyond the repair limit.

Collision insurance pays for damage to your car after an accident, regardless of who is at fault. This insurance will also pay for damage to your car as a result of hitting a hole or object such as a pole or tree.

Comprehensive insurance pays if your car is stolen or damaged by something other than a car accident. These include damage from storms, floods, falling objects, explosions, earthquakes, destruction or hitting animals (deer, raccoons, hedgehogs, etc.).

Comprehensive and collision coverage generally comes with its own rebate, i.e. the amount you have to incur before the company

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