Top 5 Types of Car Insurance Policies Explained

Before you move with your dream car, there are several formalities one has to go through to keep the vehicle safe and secure in case of a mi...

Before you move with your dream car, there are several formalities one has to go through to keep the vehicle safe and secure in case of a mishap. There are several things offered by car insurance companies, but you must proceed with an insurance policy that covers all your vehicle-specific requirements. Therefore, today we will provide you comprehensive guidelines about the top five types of car insurance policies you should consider now.

Top 5 Types of Car Insurance Policies Explained

Following are five types of car insurance policies offered by popular insurance companies like cheapautoinsurance.com for your kind perusal.

1. Liability Coverage

This type of insurance covers all the damages that may have occurred during an accident. The liability damages cover the following;

• Repair/ replacement cost of the damaged property.
• Medical bills of the third party due to their hospitalization or medical treatment.
• Minimum liability insurance as per the legal obligation and the insurance policy will cover the same.
• Choose the liability insurance premium higher than the mandatory requirement as per the law, as the policy will do the maximum coverage, and you can save fortunes. 
• This insurance covers the damage, death, or any injury caused to the third party. 
• Liability coverage is mandatory as per the statutes of a given particular country.
• You have the option to opt for the higher “sum assured.” This will ensure that you don’t have to pay a large amount when the policy’s limit has been exhausted.

2. Collision Coverage

If you have subscribed to this insurance coverage, then the expenses spent on repairing the car post-accident will be covered under this. It includes the following;

• In case the cost of repair exceeds the current market value of the market, then the insurance company will pay the current market value of the car.
• If there is a lien on your vehicle, then you must subscribe to the collision coverage.
• The collision cover can be as low as possible for old vehicles. 
• One more critical point, the collision coverage should be bought, keeping in mind the age of your vehicle. In case it is a new vehicle, then you should ensure that the collision coverage is included.

3. Personal Injury Coverage

In addition to the mandatory liability insurance, you can also subscribe to other coverages to include various risk factors. It covers all the expenses associated with the accident. Under this, the medical bill of the passenger and the driver will be covered by personal injury protection. This makes it a viable option to be opted for if you want to buy insurance for the passenger, driver, vehicle owner, etc.

4. Uninsured Motorist Protection

If your vehicle is hit by another car and the damages are not covered by any insurance coverage, then you can opt for this coverage. This will prevent you from spending the money from your pocket in case of any repair or replacement of the vehicle. In some cases, the third-party insurance coverage is not enough to meet all your needs, so this policy will help you cover all the expenses.

You can also include the additional rider, such as uninsured or underinsured protection so that you can minimize your exposure. The insurance company will also cover all the additional or the total amount that will overcome the damages or the medical bills very easily.

5. Comprehensive Coverage

The comprehensive coverage includes all types of risk factors associated with your vehicle, driver, passenger, third-party vehicle, third-party driver, third party vehicle passenger, and third-party property.

The insurance policy covers the following risk factors:

• Weather Damages
• Floods
• Fire 
• Theft

This also covers various other aspects that fall outside the purview of the collision of the vehicle. It comes in all budgets, enabling you to subscribe to any of them as per your convenience.