Before purchasing insurance coverage for your car, it’s advisable to understand the basics. From the components that are covered to choosing an insurance company that you can trust, knowing everything about car insurance is of paramount importance.
For instance, just purchasing an insurance policy from the first company you come across might look cheap and tempting. However, when it comes to compensation, things can be complicated. That’s why you should always take caution before investing in any policy. Here is everything you should understand regarding car insurance and how to choose the best one for your four-wheeler.
Table of Contents
What’s Personal Liability Coverage?
It’s important to note that the cheaper the insurance policy the harder it is to get maximum compensation after an accident or injury. So, you need to be careful when purchasing an insurance cover.
Generally, personal liability coverage acts as a foundation when it comes to all car based insurance policies. With this policy, you are protected from injuries you cause to someone else. Also, this coverage will cover you in case you cause damage to other people’s property. Each state has its own rules as far as these types of insurance policies are concerned. But basically, you will have to meet a minimum liability limit. And this usually varies depending on your area of residence.
How Does It Work?
Personal liability coverage doesn’t usually safeguard you against your injuries. It covers other road users from the injuries you inflict on them. It protects the property you destroy due to your driving actions. This cover comes with three coverage limits. And these limits are separated from each other with a slash. Here is an example: 100/300/100.
Understanding the Limits
Bodily Injury Liability Limit per Person
This is the first limit that has been listed (i.e. $100). This represents the maximum amount of money the policy can pay per person you injured through a road accident.
Bodily Injury Liability Limit per Accident
this represents the second limit (i.e. $300). It represents the maximum amount of money the policy is willing to pay per accident. This means that several people must be paid for the policy to invoke a payment of more than $100, 000.
Property Damage Liability
this represents the third limit (i.e. $100,000) when it comes to property damage. This covers all animate objects that belong to any other person but not you. It covers things like damaging other cars, guardrails, houses, etc.
Uninsured or Underinsured Motorist
In most states, uninsured motorist insurance is mandatory. Depending on your state, you will be required to pay a minimum amount of money. In most cases, a good number of insurance companies will require you to match personal liability limits with that of the uninsured motorist’s limit. By definition, uninsured motorist coverage is a cover that protects you from damages caused by an uninsured driver. On the other hand, underinsured applies in cases where the damages exceed the limits of other driver’s coverage.
The Bottom-Line
All insurance policies aren’t the same. They differ from one company to another. From things covered to terms and conditions, there are so many striking differences in various insurance policies. That’s why you should familiarize yourself with the basics before taking any insurance policy. The above information will guide you in choosing an insurance cover for your car’s explicit needs. Compare motor insurance quotes and get the best cover for your car today.
Featured image source: Freepik
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