Put quite simply the insured, (you), agree to pay your premiums on time, and your insurer agrees to provide certain coverage in the event of damage to your vehicle or person while operating the vehicle, or to others as a result of your driving. Coverage under an automobile policy can vary; always check your policy for information specific to you.
The basic coverage provided under an automobile policy is liability. This coverage provides a certain amount of money for those you may harm or for damage you may cause while driving. This coverage generally pays if you hit a pedestrian, damage another car, or cause an accident in which someone is hurt. There also may be medical coverage to cover any injuries you get while involved in a car accident or as a pedestrian. Not all states or policies provide this coverage.
Some policies provide coverage to your vehicle, called collision and comprehensive. This coverage will pay for damage to your vehicle due to a car accident (collision) or damage from other causes (like a tree limb falling on your car, comprehensive). This coverage generally has a deductible, or portion you must pay first. There are many other options available under insurance policies. Some companies offer towing and roadside assistance in case of breakdown or mechanical failure, rental car coverage is an option for when your vehicle is in an accident and you need alternative transportation, or gap insurance, to cover a debt to your lien holder in the even your car is damaged beyond repair and your settlement does not repay your loan. Always check with a licensed representative to obtain coverage best for your situation.
