Whether driver or passenger, no one likes to experience a car accident. Even a mild fender bender can prove emotionally taxing experience for most drivers. Auto insurance can often take the sting out of a car accident, giving all parties involved a sense of reassurance and peace of mind. But how much insurance should drivers carry? Here’s a look at the essentials and options when it comes to car insurance.
Must-have coverage
• Bodily injury liability: If the driver is at fault for an accident, accident, the “liability” insurance coverage pays the medical, rehabilitation, and, if necessary, funeral bills of the driver’s passengers, the other driver, his or her passengers, and any pedestrians involved. Typical coverage will pay at least $100,000 per person and $300,000 per accident.
• Property damage: Pays to repair or replace another person’s vehicle or other property damaged by the driver’s car. Many states have a required minimum for drivers.
• Uninsured motorist: Covers medical bills, rehabilitation, and funeral costs, as well as losses for pain and suffering for the driver or passengers in a car hit by a hit-and-run driver or someone who has little or no insurance.
• Collision and comprehensive: Pays to repair or replace a driver’s car no matter who is at fault for the accident. Comprehensive pays to repair or replace a car if it’s stolen or damaged as a result of a storm or other natural event. Coverage kicks in for the amount above the policyholder’s deductible.
• Personal-injury protection: Reimburses lost wages and in-home care as a result of an accident.
• Medical-payments coverage: Takes care of medical bills for a driver and passengers, regardless of fault.
Additional coverage
• Roadside assistance: Pays to have a vehicle towed.
• Rental reimbursement: Pays for a rental car when a vehicle is stolen or undergoes repairs after an accident.
Source: Consumer Reports
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