Auto Insurance – The Basics

Auto insurance was designed to protect individuals in case of an automobile accident or loss to their vehicle.

First, people want to be protected against their liability in case they injure someone or damage someone else’s property through the use of their automobile.

Second, people want protection for damage to their own automobile in case the auto is damaged in an accident or suffers other types of damage, such as fire or theft.

Since the homeowners form specifically excludes automobile coverage, they must be covered separately, through a policy called a personal auto policy, or PAP. Because the PAP contains both Property and Liability coverage, it is considered a package policy.

The Personal Auto policy consist of Declaration page and policy form. The policy form contains four separate coverages, each with its own insuring agreement, exclusions and conditions.

They are:

• Part A- Liability Coverage – This coverage may be written alone or with any of the other coverges. It provides coverage for bodily injury and property damage to others for which you are liable for up to the policy limits.
• Part B- Medical Payments Coverage - This coverage is optional, but it may only be written if the policy includes Liability Coverage. It provides medical coverage to a certain limit.
• Part C- Uninsured Motorists Coverage - This coverage may only be written in conjunction with liability coverage and is subject to other laws that vary from state to state. It is mandatory in some states; in others the insured may reject the coverage in writing. It provides protection against damage to you, your passengers and your vehicle as a result of an uninsured driver.
• Part D- Coverage For Damage To Your Auto (Physical Damage) – This coverage consists of two parts, Collision and Other Than Collision and may be written alone or with liability coverage.

The Personal Auto policy can be issued to an individual or husband and wife residing in the same household. Many Personal Auto policies are written to include all of the available coverages, but the insured does not have to purchase each one.

The above is a quick summary of usually available coverage. You must be aware that there are exclusions, limits and conditions to all the above coverage that you should be aware of.

OnlineAutoInsurance.com has licensed agents ready to go over your coverage options and answer any questions you may have.

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