Comprehensive Financial Solutions, Inc.

440-343-4223

Insurance Read Time: 2 min

The ABC’s of Auto Insurance

The questions around auto insurance center not so much on whether to have it—it’s mandated by state law, required by your lender, and serves to protect your assets—but what kind of coverage you should purchase.

Types of Coverage

There are several forms of coverage that a car owner may purchase, some of which are required, others of which may be optional.

The coverage requirements in most states include:

  • Bodily injury liability (pays for the cost of injuries you cause to another individual), and
  • Property damage liability (pays for the damage you cause to another’s car or to objects or structures you hit).

Some, but not all, states will require that you have coverage for:

  • Uninsured and underinsured motorists (covers the costs associated with being hit by an uninsured or underinsured driver, or in the case of a hit-and-run accident), and
  • Medical payments or personal injury protection (PIP) (pays for medical treatment for you and your passengers). PIP coverage is available in “no-fault” states and may also cover lost wages and funeral costs.

If you borrowed to purchase your car, the lender may require collision and comprehensive coverage.

Collision coverage reimburses you for damage to your car resulting from a collision with another car, object, or structure; a pothole; or from flipping over.

Comprehensive coverage is designed to pay for car damage not arising from a collision, e.g., theft, hail, windstorm, flood, fire, and hitting animals. This coverage may also pay for windshield repairs.

If you own your car outright, you may want to consider purchasing collision and comprehensive coverage if your car has a significant market value. You may find that the potential economic loss is sufficient to warrant the cost of collision and comprehensive protection.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright FMG Suite.

Share |
 

Related Content

The Next Gig Thing

The Next Gig Thing

Make the gig economy work for you.

5 Ways for Caretakers to Make Your Well-Being a Priority

5 Ways for Caretakers to Make Your Well-Being a Priority

Studies show that now more than ever, today’s women are disproportionately responsible for caring for children, doing laundry, cooking and cleaning, despite many having full-time careers. What’s more, when compared to their male counterparts, women are also more likely to report having difficulty finding the time to manage their physical, mental and emotional health.

The Best Apps in Travel

The Best Apps in Travel

Technology tips to make your next trip even better.

 

Have A Question About This Topic?







Thank you! Oops!

Countdown to College

Preparing for college means setting goals, staying focused, and tackling a few key milestones along the way.

The A, B, C, & D of Medicare

Learn about all the parts of Medicare with this informative and enjoyable article.

A Cheat Sheet for Sending Your Kid to College

Dropping off your son or daughter is loaded with emotions; here are a few tips for a smoother experience.

View all articles

What Is My Life Expectancy?

Estimate how many years you may need retirement assets or how long to provide income to a surviving spouse or children.

How Compound Interest Works

Use this calculator to better see the potential impact of compound interest on an asset.

Impact of Taxes and Inflation

Estimate the potential impact taxes and inflation can have on the purchasing power of an investment.

View all calculators

Investment Strategies for Retirement

Investment tools and strategies that can enable you to pursue your retirement goals.

Protecting Those Who Matter Most

The importance of life insurance, how it works, and how much coverage you need.

Long-Term-Care Protection Strategies

The chances of needing long-term care, its cost, and strategies for covering that cost.

View all presentations

Investments

You’ve made investments your whole life. Work with us to help make the most of them.

What to Do When You Lose Your Wallet

Ever lost your wallet? Frustrating. Here’s what you can do to keep yourself safe.

Charitable Giving: Smart from the Heart

Do you have causes that you want to support with donations?

View all videos