What Is Auto Insurance?
Auto insurance protects you financially when things go wrong on the road. If you cause an accident, your insurance pays for damage to other people and their property. With the right coverage, it also covers repairs to your own car and your medical expenses.
Every state requires some level of auto insurance to legally drive.
Types of Auto Insurance Coverage
Liability Coverage
This is the foundation—and what most states require. It covers:
- Bodily injury liability: Medical costs for people you injure
- Property damage liability: Repairs to property you damage (cars, fences, buildings)
Liability does NOT cover your own injuries or vehicle.
Collision Coverage
Covers damage to your car from accidents—whether you hit another car, a tree, or a guardrail. This pays regardless of who's at fault.
Comprehensive Coverage
Covers damage from things other than collisions:
- Theft
- Vandalism
- Weather (hail, floods, fallen trees)
- Animal collisions
- Fire
Medical Payments / Personal Injury Protection (PIP)
Covers medical expenses for you and your passengers after an accident, regardless of fault.
Uninsured/Underinsured Motorist Coverage
Protects you when the other driver doesn't have insurance (or doesn't have enough). More common than you'd think.
How Much Coverage Do I Need?
Your state sets minimum requirements, but minimums are often not enough. Consider:
- Your assets: If you cause a serious accident, you could be sued for more than your coverage
- Your car's value: If your car is financed or leased, you likely need collision and comprehensive
- Your health insurance: If your health coverage is limited, medical payments coverage is important
- Your emergency fund: Higher deductibles save on premiums but require more cash if you file a claim
A common recommendation is 100/300/100 liability coverage ($100K per person, $300K per accident bodily injury, $100K property damage).
Common Auto Insurance Mistakes
Mistake 1: Only buying state minimums Minimums were set years ago and rarely cover modern medical costs or vehicle repairs.
Mistake 2: Not reviewing coverage after life changes Getting married, moving, buying a new car, or adding a driver—all are reasons to review your policy.
Mistake 3: Letting coverage lapse Even a one-day gap can lead to higher rates and legal consequences.
Mistake 4: Ignoring discounts Multi-policy bundling, safe driver discounts, and good student rates can significantly reduce costs.
Next Steps
Understanding your coverage options is the first step. When you're ready to review your situation with a licensed agent, we're here to help—no pressure, no obligation.