In the US, most states mandate that anyone who owns or drives a motor vehicle must have, at the very least, liability coverage. Though there is a huge number of people insured in the US, about 160 million of them, 16% of the driving population, operate their vehicle while uninsured.
Auto insurance not only is for the protection of the driver and/or vehicle owner, but it is there to cover the individual you may hit or the property damage that you might cause. Should an accident occur, there is always the great possibility of crushing financial loss as a result. This is why it is law in most states that one must purchase at least liability insurance coverage. The two main kinds of coverage from which to choose are property damage and bodily injury or death.
Property damage coverage covers repairs or the replacement of someone else’s vehicle, property, or other personal property belongings that are damaged or lost as a result of an accident involving your car.
Bodily injury or death coverage is for any liability for which you may be responsible that was a result of injuries or even death of a third party in an accident event. Costs as a result of such incidents can rapidly pile up and this form of coverage can help protect you should you be sued and could potentially rescue you from financial calamity. Another form of coverage that is highly recommended is uninsured motorist bodily injury, as it will provide compensation for your injuries if the other driver is at fault and is in that dreaded 16% of drivers who do not have insurance coverage.
There are other helpful kinds of insurance coverage available such as policy components for repair and replacement costs of your own car, known as collision insurance. There is non-accident caused damage or theft coverage under the heading of comprehensive insurance coverage. One can also purchase medical and funeral costs coverage that is a part of a personal injury policy component. In addition, this form of coverage can cover any of your passengers or any third parties involved in an accident as well.
The largest determining factor as to what kind and the amount of coverage you should have is the laws in your own state. Each state has a required minimum coverage amount that you must purchase in order to operate a motor vehicle, so you would be wise to be fully informed of what is your minimum legal responsibility to purchase and to investigate other coverage as well so as to be fully protected.