Most people don’t have extensive knowledge of the different types of car insurance available when they first start driving, and this can make choosing a plan that works for them difficult.
A lot of insurance companies require new drivers and car owners to have full coverage insurance, the most inclusive option when they purchase their first plan. Other types of insurance, like liability-only, only cover accidents caused by the holder of the insurance. Rental insurance covers cars rented by people who have liability covered through a private insurer; usually, the policy is a type of full coverage insurance for the rental car. Collision insurance only applies to cars involved in a collision. Comprehensive, or “other than collision” insurance covers damages caused by incidents other than a collision, such as attempted theft or an ‘Act of God’ like a hurricane or natural disaster. These insurance types are just a few of many; there are many other types of highly-specialized coverage plans available for interested parties. Most of these are highly dependent on who is at fault, whether that be the policyholder or the other party.
One type of insurance that does not rely on who is at fault is Personal Injury Protection, or PIP. Commonly referred to as “no-fault coverage,” this insurance will cover the policyholder, even if they were the party responsible for the damages. To a certain dollar amount, PIP covers the medical and/or funeral expenses of everyone involved. This means that the insured party, the other people in the vehicle at the time, and pedestrians (if they were struck by the vehicle) will all have some or all of their expenses paid for by the policy holder’s insurance. It also potentially covers lost wages that occur as a result of the collision, but pain and suffering are not covered by PIP. Personal Injury Protection isn’t available in every state. Many states have auto medical payments, or AMP coverage, as a substitute. However, AMP is not generally required in the states that it is offered in the same way that PIP is. A few states offer both types of coverage and they work together to best benefit the policyholder.
Only around twelve states currently have some form of mandatory PIP coverage available to drivers. Other states like South Carolina offer PIP yet don’t make it a mandatory form of coverage. For personal injuries caused by vehicular accidents, law firms like the Hammack Law Firm will fight insurance claims and seek damages on behalf of the injured. Personal injury lawyers can work as a substitute for PIP coverage for those without the policy.
Regardless of the policy you choose, it’s important to have a way to cover medical expenses and lost wages in the case of an emergency! If you find yourself struggling to pick a form of coverage, try to find a plan that offers a no-fault option. This can come in handy if you end up in a situation where other policies aren’t responsible for covering the collision.