When you closely examine the different types of car insurance out there, you may find yourself becoming overwhelmed. Insurance companies do not make it easy with all of the choices; when you add in state requirements to the equation, deciphering insurance becomes even more complicated. No one wants to pay for coverage that they do not need, but you also want to make sure that you have adequate coverage in case an accident occurs.
While there are dozens of types of insurance – and specialty add-ons offered by insurance carriers – there are five main types that you need to be aware of.
1. Liability Insurance
Liability insurance is what covers you if you are involved in an accident and it’s determined that you were at-fault for the accident. It can cover the cost of repairs to others’ property, medical bills, and other related expenses. There is a minimum amount of liability insurance that you must carry in the state of Illinois, which is $25,000 for bodily injury (per person), $50,000 total for bodily injury (per accident), and $20,000 for property damage. While you are required to meet these minimums, it is in your best interest to carry more than the state-required minimum. Also, realize that liability insurance does not cover your own costs for property damage or personal injury – it only covers injuries and damage to others.
2. Collision Coverage
Collision coverage is what handles covered accidents. This will only cover the damage to your vehicle or replace your vehicle if the total damage is more than the vehicle’s value (known as a “totaled” claim). Older vehicles often do not benefit from collision coverage – especially when the vehicle is only worth a few hundred dollars.
3. Comprehensive Coverage
This covers damage that occurs unrelated to a car accident. For example, if your windshield is broken, due to poor weather, comprehensive insurance may cover the damages. This form of insurance is a good type of coverage to have, but is not necessary. If your budget permits it, you may want to add comprehensive coverage to cover all possible damage.
4. Personal Injury Protection
Comprehensive coverage is optional, but personal injury protection (PIP) is something that you cannot go without. PIP handles the costs of injuries and medical treatments associated with a car accident. With this level of coverage, your medical bills are taken care of by your insurer after an accident.
5. Uninsured/Underinsured Motorist Protection
It is state law to carry adequate car insurance, but that does not mean everyone follows the rules. There are hundreds of cars in the state without insurance – which means that, if they have an auto accident with your vehicle, you will be required to pay for your own damage. Uninsured and underinsured motorist coverage protects you from having to pay out-of-pocket for accidents with uninsured drivers or drivers with inadequate liability coverage.
Were You Injured in a Car Accident?
While you may have auto insurance, that coverage does not account for everything, and negotiating with insurers can be difficult. If you have been injured in an accident, contact the expert attorneys at Malman Law. We can help negotiate with insurers on your behalf and get you the compensation that you deserve for your injuries. Schedule your free consultation today by filling out our online contact form with your questions.