Understanding the Six Parts of Auto Insurance

Understanding your auto insurance can be overwhelming. Don’t worry. We’ve got you covered. Here are the main coverage’s of your auto policy.

Bodily Injury Liability

This is what kicks in from your policy if you cause injury to someone else while driving. In Colorado, you are required by law to maintain a policy that covers $25,000 in bodily-injury liability insurance per person and $30,000 per incident.

Property Damage Liability

This is what protects you if you cause damage to someone else’s property. The state of Colorado requires you to maintain a policy that covers at least $15,000 in property damage per incident.

Collision

This will cover the expenses of the repairs or in getting a replacement vehicle if you get into an accident involving another car, back into a light pole, bust your mirror off backing out of the garage, or have any other type of collision whether it involves another vehicle or not.

Medical Payments Coverage or Personal Injury Protection

In some states this is called PIP. Here in Colorado it’s called MedPay or MP. The coverage of this is for paying medical bills (usually ones that aren’t covered by your health insurance) that you or your passengers may accrue after an accident.

Comprehensive Auto Insurance

This covers other damage to your car that isn’t caused by a collision with another car. Like if your vehicle gets vandalized or you hit a deer. This is usually an optional type of coverage, but if you are making loan payments, your lender may require you to have comprehensive coverage.

Uninsured or Underinsured Motorist Coverage

It’s estimated that 1/3 of Colorado drivers are not insured. This is a scary fact, considering many of us drive on Colorado roadways every day. Uninsured motorist coverage is what will cover your injuries if you get into an accident with an uninsured driver. Underinsured motorist coverage kicks in when the driver at fault has liability insurance, but not enough to pay for all of the damage they caused.
Although this type of coverage isn’t mandatory in Colorado, it is strongly recommended that your policy covers at least $100,000 per person and $300,000 per incident.

When purchasing automobile insurance what should I consider?

There are several things you should consider when purchasing automobile insurance that your independent agent will help you with. Here are a few:

Purchase the amount of liability coverage which makes sense for you.
Select the optional coverages you want.
Decide which company to purchase insurance from.
Don’t base your decision solely on price. Other factors like service and claim response are extremely important in selecting the right insurance.
Does my insurance policy cover a friend if I loan him/her my car
When you loan your car to a friend or an associate, he or she will be covered under your automobile insurance policy.
What is collision physical damage coverage?
Collision is the loss you incur when your automobile collides with another vehicle or object like a telephone pole.
What is comprehensive physical damage coverage?
Comprehensive provides coverage for direct physical damage losses you could incur to your car from something like a hailstorm
How can I lower my automobile insurance rates?
There are several things you can do to lower the cost of your automobile insurance.
One way is to look for competitive pricing. An independent agent works with many companies and can provide you comparative rates and insure that your are getting the same coverage.
Another way to lower the cost is to change your deductible. By raising your deductible you may lower the cost of your automobile insurance almost 10% You must be able to pay the deductible amount in case of a claim. You can also look for discounts that you may be entitled to. Some examples of discounts that may be available are: multiple cars under the same policy, carrying a homeowners policy with the same insurance company, different groups or associations.