August 20, 2010, Newsletter Issue #230: Car Insurance Terms - Your Coverages

Tip of the Week

Auto insurance term definitions are important to know when shopping for car insurance. When you know what you are buying you can make a more informed choice.
Bodily Injury Liability - This number is represented as a per-person/per-policy set of numbers, for example 50,000/100,000 (your numbers may be different.) The first number is the maximum amount your policy will pay out for bodily injury (doctor bills are an example of something paid by bodily injury) for each person with injuries. The second number is the maximum amount the policy will pay per accident. Property Damage - If you are determined to be at fault, property damage liability coverage on your policy will pay for someone else's property that you have damaged. That could be the other person's vehicle, trailer, or even garage if you hit it with your car.Collision - This coverage repairs the auto insurance policy owner's vehicle, not the other person's. If you are at fault in an accident, your collision will repair your vehicle after the deductible is paid.Comprehensive - If a tree falls on your car, if a rock hits your windshield and it cracks, if property is stolen from your vehicle, or if you hit a deer - if your policy covers it, comprehensive coverage is what will pay for your vehicle to be repaired. This coverage pays after the deductible has been paid and put toward the repair.

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