There are a lot of different types of auto insurance; do you know the differences and what you actually need to include in your auto insurance coverage?

Bodily Injury Liability – This is relevant if you are at fault in an accident causing others to need to be hospitalized and or cause lost of wages because of missed work.  You are responsible for these expenses and would need to be paid by you if you do not have Bodily Injury Liability coverage.  These amounts can add up very quickly and because of this many state make it mandatory to have this coverage.

Collision Coverage – If your accident causes needs for repair or replacement of your vehicle, this is where collision coverage comes in.  The policy that you sign up for will have a deductable that you will have to first pay on repair costs before the insurance kicks in.  The lower the deductable that you chose, the higher the premiums will be.  If you chose a higher deductable, the premiums decrease.

Comprehensive Coverage – If you have damage caused by objects that have fallen, fires, theft, vandals and even some natural disasters; this is what is covered under Comprehensive.

Property Injury Liability – if you have an accident, like driving into a person’s home or car, this is considered property injury.   If you don’t have property injury liability, you would be personally responsible for the damages that you caused.

We live in a very fast paced world and unfortunately accidents can happen in a blink of an eye.  Because of this, you need to be fully aware of what type of coverage you currently have and if it is sufficient to truly cover yourself, property and assets.  You don’t want to find out the hard way that you might not have all of the coverage that you should.

You should make it a practice to review your policy each year.  Many make the mistake of simply paying the bill on a policy that was set up years ago.  Things change and you need to make sure that you are up to date in your coverage.