[COLUMN] 5 types of car insurance explained

Car insurance policies vary in what they cover. The state mandates certain types of coverage that you must have to legally get behind the wheel. However, the mandated minimum coverage may be far too low in some situations, such as being in a hit-and-run, in an accident with an uninsured driver, or if your car is damaged by a falling tree or fire. As a driver, it helps to understand the various types of auto insurance available, as you may decide to pay just a little more to gain a lot more protection.

  • Liability: This is the coverage that will pay for the other party when you are responsible for a collision. This coverage comes with a limit the insurance company will pay if you are found to be responsible for a crash. You can increase the amount of liability coverage you have on your vehicle.
  • Collision: This coverage replaces a damaged vehicle after an accident (no matter who caused the collision) and is required for drivers with financed or leased vehicles.
  • Comprehensive: This type of coverage pays for damages to a vehicle caused by incidents other than collisions, such as a tree falling on a vehicle, vandalism, theft, fire, and so on.
  • Uninsured/Underinsured: A shocking number of drivers operate vehicles without current auto insurance. If you are in the wrong place at the wrong time and in a collision with such a driver, you want to ensure you have this coverage in place. It pays out for vehicle damage and medical care. An underinsured driver may have only the minimum as required in the state, which does not cover your actual medical bills – this insurance could save the day.
  • Rental Reimbursement: Your auto insurance may pay for a rental car for you to use when your vehicle is damaged in an accident. Knowing you will have transportation in this situation is essential.

Auto insurance policies – what’s right for you?

You may be a very safe driver. However, even the most careful driver can run into trouble when sharing the road with a driver who is drunk, on drugs, speeding, distracted, or driving recklessly. As much as we hope to avoid car accidents, over a lifetime, they can happen. A collision can range from minor fender-benders to a serious crash. In addition, incidents involving theft, vandalism, or weather-related damage are fairly common.

Protect your vehicle and your family

Why not make sure your investment in your vehicle is protected? For assistance in choosing the best auto insurance policy, get help from an insurance agent. You may be surprised to discover that adding extra coverage, such as uninsured/underinsured driver coverage or comprehensive insurance, will increase the premiums but add a layer of protection for when the unexpected happens. If you have a teen driver, don’t scrimp on auto insurance. Young drivers, even well-trained, lack the extensive experience that results in being a good driver. Statistically, they are more likely to be involved in a collision.

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The opinions, beliefs and viewpoints expressed by the author do not necessarily reflect the opinions, beliefs and viewpoints of the Asian Journal, its management, editorial board and staff.

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Melody Avecilla is an insurance expert. Her one-stop-shop agency has been a preferred go-to insurance resource for over a decade. She has a Masters in Business Administration from Loyola Marymount and earned her CLU (Chartered Life Underwriter) designation at The American College. Her team has been voted best in the industry for years in a row. Fun fact about her. She has  multiple patents for the world’s first retractable high heels. In between work, she hosts a global leadership podcast called “dreamers to leaders.” She’s takes a hyper focused  approach in elevating customer experience in running her businesses.  Insurance is her flag ship enterprise.

(Advertising Supplement)


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