When buying insurance, it is essential that you understand the type of coverage options available. You can be a responsible car owner and driver who always ensures that their car is in perfect working condition, obeys all the road rules, and drives safely. But, even then, you can still meet some unexpected incidents on the road.
These could be accidents, tire bursts, and other natural disasters. When such happens, you need car insurance to cater to the financial burdens of repairs. This insurance will protect you from unforeseen events involving your vehicle.
Of course, in many places, you must have basic car insurance. But along with this, you can also buy other coverage types to offer more protection. Let us learn about the different car insurance coverages that exist.
Liability Coverage
Liability coverage can be bodily and property damage coverage. It is mandatory in all states and provides coverage for injuries you cause on other people and their property. If you get into an accident, and you cause damages, liability coverage will pay up to your selected limit. Plus, in some cases, it can offer a legal defense should you be sued.
Bodily liability covers for injuries to another person if you cause an accident. Property liability, on the other hand, pays compensation for the damages you cause to a person’s property while driving.
Comprehensive Coverage
This coverage compensates damages to your car from natural disasters like fire, hail, etc., or theft and vandalism. For instance, if peril damages your vehicle, you can claim compensation from a Singapore car insurance company through this coverage. It may cater to the replacement or repair needed for your car.
But bear in mind that this coverage includes a deductible. That means that you’ll have to pay some amount out of pocket first, then your insurer can reimburse you for the claim.
Comprehensive coverage is usually optional, but it may be mandatory in some cases. For instance, if you are financing or leasing your car, the lender may ask you to buy this coverage.
Underinsured or Uninsured Motorist Coverage
If you are involved in an accident, and the other driver doesn’t have insurance, uninsured coverage will protect you. Also, in case the other driver doesn’t have enough insurance, underinsured coverage can chip in.
Like comprehensive, this is optional but may be required in some cases. Also, note that there are two types of uninsured coverage; an uninsured bodily injury that compensates you and your passengers during a hit-and-run and uninsured property damage that covers the damages on your car in case of a hit-and-run accident.
Collision Coverage
Collision coverage caters to the damages on your car if you hit an object or another vehicle. For instance, if you run into the back of a tree, having this insurance will cater to the damages. Or if your vehicle flips over on the road, the repair or replacement costs will be catered to.
Collision coverage is optional but it may be required if you’re leasing or financing your car. Confirm with your lender whether you need to purchase this coverage.
Medical Payments Coverage
If you or your family member is driving an insured car and gets into an accident, this cover will pay the medical bills for the injuries. These include x-rays, surgery, doctor’s visits, medications, and more.
But note that the coverage may not be available everywhere. However, if you get into an accident in another location, you will be compensated no matter where the accident occurred.
Personal Injury Protection
It’s also called no-fault insurance. It caters to the injury losses in a car accident, regardless of the person that was at fault. That means medical bills, lost wages, and funeral expenses will be catered to.
Like most other insurance coverage, PIP is optional in many places. However, it may be mandatory in other locations. Please check with your state for accurate information.
Additional Car Insurance Coverage
You can also purchase other policies besides the ones we’ve listed above, depending on your insurer. These include gap assistance, full auto glass, personal umbrella, etc. Note that some situations may force you to have a specialty insurance policy.
For instance, if you are driving a classic or antique car, you need insurance that considers the age, value, and driving frequency of a car.
Do I Need Car Insurance?
No matter where you live, you are required to purchase insurance for your car. If you get into an accident with an uninsured car, several things can happen. You may be charged for violating the laws, depending on your country. And this could make you lose your license.
Also, you may be charged with a civil lawsuit if you caused the accident. And again, you may not be able to cater to the repair and replacement costs out of pocket.
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