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Two Types Of Auto Insurance Coverage


Two Types Of Auto Insurance Coverage

Reil Miller
25 July 2012


There are different types of insurance that an individual must take into consideration. One of the most basic insurance is the auto insurance. Auto insurance offers protection against potential catastrophe such as vehicular accidents. If an accident occurs, the auto insurance coverage is capable of paying for the damages and injuries. Aside from this, this type of insurance is also mandated by the state laws for all drivers.

Most state laws across the country require every driver to purchase liability insurance. Auto insurance is a necessary expense for every driver for it provides leverage against potentially catastrophic and financially compromising events. This type of insurance can provide protection against accidents such as car accidents. The car insurance is a contract between the driver and the insurance provider. The insurance policy holder must pay a certain amount of premium every month for the coverage that he or she has chosen. In exchange, the insurance provider will pay for any injuries or property damages incurred depending on the coverage listed on the policy purchased. There are different types of insurance coverage, and whether or not the accident will be covered by the company depends on the coverage listed on the insurance policy. For this reason, if the insurance policy holder does not pay for a certain type of coverage, the insurance provider will not pay for it.

Insurance coverage typically breaks down into two types: liability and first-party coverage. The liability insurance coverage pays for the property damages and injuries that the policy holder has inflicted upon another individual. The liability car insurance is also divided into property damage and bodily injury liability. The first-party coverage, on the other hand, pays for the damage and injuries sustained by the policy holder. However, this type of insurance coverage usually comes with a deductible. The deductible amount is what the policy holder must pay for a claim before the insurance provider can cover any expenses. With these two types of coverage, the policy holder will have full coverage car insurance. The car insurance can also be broken down into more specific coverages that pay for certain kinds of situations.

It is essential to first understand the different types of auto insurance coverage before deciding upon purchasing a certain type. This will enable the policy holder to have an idea of what they can get in case of an accident or other catastrophe. It is also important to make sure that the right coverages is purchased to avoid being in a financially compromising situation.


Reil Miller is a freelance writer who writes about the importance of having Lincoln car insurance and how it can help during an accident or emergencies. She also writes for car insurance providers such as Allstar Insurance




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