What Are the Main Types of Car Insurance?

If you own a car, you need insurance to keep yourself, your car, and others protected.

Car insurance comes in different forms, with various price points for each. Choosing the right one for you can seem like a difficult task. It’s especially confusing when there are so many options to choose from.

Not sure which car insurance is right for you? Here are the main types of car insurance with their pros and cons.

Liability Car Insurance 

Liability Car Insurance is one of the main types of car insurance available. It is designed to provide financial protection for other people and their property if you are found responsible for an accident that results in injuries or damages to another person or their property.

Liability coverage is typically required by law to be carried with car insurance, and many state laws set minimum coverage limits. It is important to ensure that adequate coverage limits are selected in order to effectively protect against potential financial losses.

Comprehensive Coverage 

Car insurance comprehensive coverage is a form of car insurance that provides protection for vehicle damage caused by events beyond the driver’s control, such as theft, vandalism, fire, hail, and other natural disasters.

Comprehensive coverage typically has a zero-deductible policy, meaning that all costs for repairs are taken care of out of the policyholder’s pocket. Comprehensive coverage is a great addition as it can provide peace of mind in the event of an unexpected event.

Collision Insurance

Collision insurance is a type of car insurance that covers the cost of damage to your vehicle when it collides with another car, person, animal, or object. It pays for repairs to your vehicle up to the actual cash value of the car.

Collision insurance covers you when you are at fault for an accident and also covers you even if you are not at fault. Collision insurance also normally covers legal fees if you are found at fault in an accident. 

Gap Insurance

Gap insurance is a type of insurance that helps cover the “gap” between what you owe on your car loan and what your car is worth if it’s totaled or stolen. It’s important to understand the two main types of gap insurance.

Gap insurance is often recommended for buyers of newer and more expensive cars, as these vehicles often depreciate in value quickly. Understanding the different types of gap insurance can help you determine which type is best for your situation and save you a large amount of money should anything happen to your car.

Uninsured Motorist Insurance

Uninsured Motorist Insurance (UMI) provides financial protection against losses caused by drivers who do not have auto insurance. It is typically added onto existing car insurance policies and is either split or stacked.

Uninsured motorist, bodily injury coverage, pays for medical expenses and other related damages when a person is injured by an uninsured driver. Uninsured motorist, property damage coverage, pays for damage to a person’s vehicle when an accident is caused by an uninsured motorist. Do your research on where to get SR22 insurance to get the best car insurance options.

Learn More About Types of Car Insurance

The main types of car insurance are liability, comprehensive, and collision. Depending on the policies available in your particular state, there may be other types too. Doing research about car insurance before you purchase a policy is key. 

Did you find this article informative? Check out the rest of our blog for more!

Last Updated on April 27, 2023

Usama BIN Safdar
Meet Usama Bin Safdar, a wordsmith hailing from Faisalabad, Pakistan. With over 5 years of experience under his belt, he's a master at weaving words to create content that's not only informative but also engaging. He's a deep-diver when it comes to SEO, and as the Founder of SoftwareBench, he helps businesses and individuals navigate the digital landscape with ease. Follow Usama for a journey into the world of SEO and digital marketing, where every word is crafted with precision and passion.

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