If you’re shopping for car insurance, you might hear many terms you’re familiar with. While you are buying only one policy covering just one vehicle, many factors determine the cost of your car insurance policy — and these terms often are used to describe these factors.
The most common terms that affect your car insurance policy are as follows:
- Bodily injury liability: Should you get into an accident where your vehicle hurts or kills someone, this coverage pays any claims and legal costs.
- Collision coverage: This coverage pays for any car damage up to its book value. This type of coverage has a deductible. The higher your deductible, the lower your premium. If your car is financed, lenders often require collision coverage.
- Comprehensive coverage: This coverage pays for any physical damage to your car. The damage could be sustained by vandalism, wind, fire, theft, flood or other causes that aren’t accident-related. This coverage also has a deductible.
- Deductible: This is the amount that you must pay before the insurance pays their part for any claim.
- Medical payments: This covers injuries to you and any passengers hurt in an accident. In many states, this coverage is optional.
- Property damage liability: In an accident where your car damages any property, this coverage takes effect to protect the other party. Most states require this coverage.
- Uninsured motorist protection: Covers you and any passengers if you are in an accident with someone who is not insured or if you are involved in a hit-and-run altercation. It is estimated that almost 30 percent of vehicle owners do not carry insurance.
The more knowledge you have, the better decisions you can make.
Do you have enough coverage? Call Prairieland Insurance Group, LLC at 217-352-9000 for more information on auto insurance.