The three types of car insurance that are universally offered are liability, comprehensive, and collision insurance. Drivers can still purchase other types of auto insurance coverage, like personal injury protection and uninsured/underinsured motorist, but they are not available in every state.
3 Major Types of Car Insurance
1. Liability insurance
Liability car insurance is coverage that pays for other people’s expenses after accidents that you cause, and there are two components of it. Property damage liability insurance pays for any damage that you cause to someone’s property, and bodily injury liability insurance pays for their medical bills.
Liability coverage is the most common type of car insurance. It is required in almost every state.
2. Comprehensive insurance
Comprehensive car insurance pays to repair or replace your vehicle when it is damaged by something other than an accident, such as vandalism or a natural disaster. It is not required in any state, but it is usually mandatory for vehicles that are leased or financed.
3. Collision insurance
Collision insurance is a type of car insurance that covers damage to your vehicle that is caused by an accident, regardless of who was at fault. It is not required in any state, but it’s usually mandatory for vehicles that are leased or financed.
Other Types of Car Insurance
In addition to the 3 major types of car insurance – liability, collision and comprehensive – there are several other types of coverage that are less frequently required but still helpful in the right situation, including:
To learn more, check out WalletHub’s guide to the different types of car insurance.
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