Auto Insurance - ABCs

Unless you are an auto insurance agent, many of the facts, policies, and insurance jargon they speak sound like a foreign language. Therefore, at Auto Insurance Group, we would like to help explain these "code words" and translate them into simple, everyday language we can all understand.

First off, an automobile policy is really one large policy made up of smaller policies. Of course auto insurance policies differ from person to person because they should be customized to fit that individual person's auto insurance-lifestyle needs: where you live, how old are you, what you drive, what your lifestyle is, etc.

The most common forms of auto insurance, which you probably heard at least once, are: liability insurance, medical or personal injury insurance, collision insurance, comprehensive insurance, uninsured motorist insurance, and underinsured motorist insurance. Even options such as towing coverage and daily rental reimbursement are considered smaller, additional insurance policies.

The following gives you a general definition of what each insurance policy means:

Liability Coverage-is considered the most essential coverage on an auto insurance policy. A standard liability policy is made up of two policies, bodily injury and property damage. These policies cover you for the amount, up to your policy limit, of personal injuries and property damages (usually includes the vehicle) that you are "at fault" for, and, therefore, have caused the other party in an auto accident.

This coverage is usually stipulated as three numbers such as, 25/50/10. This means that this particular policy coverage would provide personal injury coverage up to a maximum $25,000 per person, up to a maximum coverage of $50,000 for all injuries in that accident, and maximum property damage coverage of $10,000 for that auto accident. Also, virtually every state requires a minimum liability coverage that is stipulated in the same manner as just described.

Medical Coverage-This policy is designed to cover the costs, up to your specific maximum limit, of injuries that you have sustained in an auto accident no matter who was "at fault" in an auto accident. It is required in some states so you need to verify this.

Personal Injury Protection, PIP-is essentially the same as medical coverage but differs because it encompasses more coverage protection. Under PIP, you are covered, up to your maximum policy limit, for related costs to personal injury such as lost wages while recuperating, in some cases even rehabilitation costs, and funeral expenses. PIP is required in every "No Fault" insurance system state, currently 12 states, as well as some additional states. Therefore, you need to verify if this coverage is required in your state.

Collision Coverage-is optional insurance that covers collision damages to your vehicle, regardless of who is at fault. If your vehicle is financed collision coverage is probably required.

Comprehensive Coverage-is optional insurance that covers damages to your vehicle that is caused by anything else, natural disasters, vandalism, auto theft, etc. If your vehicle is financed comprehensive coverage is probably required.

Uninsured and Underinsured Motorist Coverage-are two similar policies. Uninsured Motorist Insurance helps cover your costs, up to your policy limits, if you are struck by a motorist ("at fault") who possesses no insurance coverage. Underinsured Motorist Insurance helps cover your costs, up to your policy limits, if you are struck by a motorist ("at fault") who possesses less than adequate insurance coverage.

Surveys have revealed that a significant percentage of motorist who operate a motor vehicle are driving with either no insurance or inadequate insurance. Therefore, it is considered prudent to possess these policies.

Endorsement Coverage-refers to usually smaller, optional policies such as: roadside towing, daily rental car reimbursements (while your car is being repaired), emergency roadside assistance, etc.

In closing, in today's litigious society where medical and health care costs are astronomical, auto insurance has become a reluctant necessity in our lives. So much so that virtually every state has passed auto insurance laws that require drivers to possess minimum insurance coverage. Therefore, even despite high annual insurance premiums, auto insurance has become a reluctant necessity in our society like taxes.

Possessing a policy that has adequate coverage is not only financially prudent and socially responsible, it is required by law. Therefore, it behooves you to acquire an adequate policy that matches your lifestyle, insurance needs, and meets or exceeds your state minimum auto insurance requirements.

The good news is that since auto insurance companies have different methods for calculating your annual premiums, how well you shop and compare policies can greatly reduce your annual insurance premiums for the same auto insurance policy.

This is why at Auto Insurance Group, we have provided you with a fast, easy method for obtaining a quote and shopping and comparing that policies against others to help you meet your auto insurance needs.

Get a GEICO Quote.

Auto Insurance:

The Auto Insurance Group provides
you the best tools to save money.
Stop over-paying for car insurance.

Information and resources:
Auto Insurance Quotes
No Fault Auto Insurance
Auto Insurance ABC's
A Closer Look at Auto Insurance
Auto Insurance Definitions
Auto Insurance Discounts (definitions)
Auto Insurance Cost Variations
Steps to Lower Your Rate
Reasons for Cancellation
No Fault Insurance
Questions About Auto Insurance
Personal Protection Policy or PIP
Teenage Drivers
Minimum Liability Limits
Auto Insurance Tips
Cheap Auto Insurance
Free Insurance Quote
Buy Auto Insurance On-line

Best Price Insurance

Are auto insurance quotes really free?

Yes. All quotes are 100% free and without obligation.

Try it. Compare the quote with what you are currently paying.