What is your basic auto insurance policy covering?

Know your car coverage

What is your basic auto insurance policy covering

While there are many different directives in different countries for auto insurance, most basic vehicle insurance policies comprise of six types of coverage. Here's what you should know about them.

While various countries or localities in the world order various sorts of protection and there are a few extra choices (example gap insurance) presented, most elementary vehicle policies consist of the following: bodily damage liability, personal injury protection, property damage liability, collision, comprehensive and uninsured/underinsured driver.

Note that each of these coverage is evaluated independently, so there is inconsistency in policy limits and values.

Bodily damage liability

Bodily damage liability coverage relates to wounds that you, the assigned driver or policyholder, cause to another individual. You and the relatives listed on the policy are likewise secured when driving someone else’s vehicle with their authorization.

It’s imperative to have liability insurance, in case you are involved in an accident since you may be charged for a huge sum of money. It has been prescribed that policyholders buy more than just the country-required minimum liability insurance, enough to secure resources like your house and property.

Medical bills or personal injury protection (PIP)

In case of an accident, this insurance covers the management of injuries to the driver and passengers of the policyholder's vehicle. At its best, PIP covers medical bills, lost wages and the expense of substituting services usually performed by someone injured in an auto accident. It also provides coverage for funeral costs.

Property damage liability

This policy covers any damage you (or someone driving your vehicle with your authorization) may cause to someone’s property. Typically, this refers to damage to another person’s vehicle, but it also covers damage to lampposts, telephone poles, fences, buildings or other structures your vehicle may hit.


Any damage to your vehicle as a result of collision with another person’s vehicle, an object, such as a telephone pole, a tree or a lamppost, or due to flipping over will be covered by this coverage. It also provides coverage for damage caused by potholes.

It is commonly sold with a distinct deductible. Even if the accident was your fault, your collision coverage will repay you for the expenses of refurbishing your vehicle, minus the deductible. If it wasn’t your fault, your insurance agency may try to recoup the sum they paid you from the other driver’s insurance agency and, if they succeed, you'll also be repaid for the deductible.


This coverage will repay you for any loss due to burglary or harm caused by anything except for a collision with another vehicle or roadside object. Comprehensive coverage provides cover for dealings such as fire, falling objects, missiles, blast, earthquake, windstorm, flood, vandalism, uproar, or contact with animals like birds or deer. Any damage to your windshield whether it is cracked or shattered is also covered by this.

Comprehensive insurance is generally sold with an independent deductible, although some insurance providers may offer the glass portion of the inclusion without a deductible.

Uninsured and underinsured motorist coverage

Underinsured motorist coverage repays you, your family member, or an assigned driver in case of being hit by an uninsured driver or a driver who doesn’t have adequate insurance to pay for your total loss. It also offers security in the occasion a protected driver is the victim of a hit-and-run or if, as a pedestrian, you are struck by an uninsured or underinsured driver.

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