1. Liability Insurance
Liability insurance is the foundation of most auto policies and is required by law in almost every state. It is designed to cover the costs associated with injuries or property damage that you cause to others in an accident where you are at fault.
What it Covers
- Bodily Injury Liability: Pays for medical bills, lost wages, and legal fees for the other party.
- Property Damage Liability: Pays for repairs to the other person's vehicle or property, such as a fence or building.
Note: Liability insurance does not cover your own injuries or damages to your own vehicle. For more on handling the aftermath of an accident, see our Auto Insurance Claims Process Guide.
2. Collision Insurance
While liability covers others, Collision Insurance is there to protect your own vehicle. It covers repairs to your car after an accident, regardless of who is determined to be at fault.
What it Covers
- Collisions with other vehicles.
- Hitting stationary objects like trees, guardrails, or telephone poles.
- Single-car rollover accidents.
This coverage typically pays out up to the Actual Cash Value (ACV) of your car, minus your selected deductible. It is often required by lenders if you finance or lease your vehicle.
3. Comprehensive Insurance
Comprehensive Insurance covers damage to your vehicle caused by events that are out of your control and not related to a collision.
What it Covers
- Theft and vandalism.
- Fire and explosions.
- Natural disasters, such as floods, hurricanes, and hail.
- Falling objects (e.g., a tree limb).
- Animal strikes (e.g., hitting a deer).
Like collision coverage, comprehensive pays up to the actual cash value of your vehicle minus your deductible. Read more about industry standard coverages on the Insurance Information Institute (III) website.
Ready to Find the Best Rate?
Understanding your coverage options is the first step. The next step is finding the best rate for the coverage you need. Learn How Auto Insurance Comparison Works with Motorance and start saving today.