| When it comes to auto insurance, many people | | | | GAP Coverage. We all know that there is a sharp |
| are easily confused by the different types of | | | | decline in the value of a car immediately after |
| coverage available. To help you understand these | | | | purchase. This means that any loan you took out |
| coverage types better, they are listed below with | | | | to finance the purchase of the vehicle could be |
| definitions and explanations for your benefit. | | | | many thousands of dollars greater than the |
| Liability Cover - Liability coverage is the minimum | | | | amount your auto insurance company would pay |
| auto insurance covered required by law in most | | | | out if your car was stolen or became a total loss |
| states. It is intended to cover the victims of an | | | | following an accident. Gap cover or loan/lease |
| auto accident that is deemed to have been | | | | cover as it is also known is intended to bridge |
| caused by you. Your own bodily injuries or | | | | that gap in valuation and the amount you owe on |
| property damage is not usually covered by liability | | | | the loan. |
| insurance. | | | | PIP Personal Injury Protection - PIP (also known |
| Comprehensive Cover. Auto insurance | | | | as no-fault), covers medical and funeral expenses |
| comprehensive coverage covers damages to | | | | and lost wages of the driver and passengers in |
| your car that are not caused by other motorists, | | | | the insured vehicle no matter who caused the |
| including fire, theft, vandalism and storms. | | | | accident. |
| Collision Coverage - Collision coverage, as it's | | | | Pay-Per-Mile/Pay-As-You-Drive. Unlike the usual |
| name suggests, covers damages to your car due | | | | type of auto insurance policies that charge a flat |
| to collision with other vehicles, stationery objects | | | | rate based on time periods, Pay-Per-Mile coverage |
| and any road obstructions. | | | | is based entirely on the distance driven. The |
| Uninsured/Underinsured Cover - Uninsured driver | | | | distance is measured via a tracking device that |
| coverage covers your medical expenses and | | | | the auto insurance company fits to your car. |
| those of your passengers (and in some states | | | | With the Internet easily accessible you have a |
| property damage as well), in an accident caused | | | | vast amount of knowledge at your fingertips to |
| by a hit-and-run driver, a driver with inadequate | | | | help you choose the best coverage for you and |
| insurance, or a driver with no insurance at all. | | | | your lifestyle. |