When it comes to car insurance, there are a lot of terms and concepts that can be confusing. This guide is designed to help you understand some of the most common ones. First, let’s start with some basics. Car insurance is a policy that provides financial protection if your car is damaged or stolen. It can also protect you if you are sued for damages caused by an accident. There are two main types of car insurance: liability and comprehensive. Liability insurance covers damages that you cause to other people or their property. It also covers your legal expenses if you are sued.

When it comes to car insurance, there are a lot of terms and concepts that can be confusing. In this blog post, we’re going to demystify some of the most common car insurance terms and concepts.

The first thing to understand is that there are two types of car insurance: liability insurance and collision insurance. Liability insurance covers damage that you cause to other people or property. Collision insurance covers damage to your car.

There are also two types of coverage: full coverage and liability coverage. Full coverage means that you are covered for both liability and collision. Liability coverage means that you are only covered for liability.

The next thing to understand is what deductibles are. A deductible is the amount of money you have to pay out of pocket before your insurance company will start to pay for damages.

Another common term is comprehensive coverage. Comprehensive coverage is an optional type of coverage that covers damage to your car that is not caused by a collision. This can include damage from things like hail, fire, or theft.

Lastly, it’s important to understand what your policy limits are. Policy limits are the maximum amount of money that your insurance company will pay out for damages.

Liability Coverage

Liability coverage is one of the most important types of car insurance coverage. It protects you financially if you’re found at fault in an accident. In most states, liability insurance is required by law.

There are two types of liability coverage: bodily injury liability and property damage liability. Bodily injury liability covers medical expenses and lost wages for the people injured in an accident that you caused. Property damage liability covers the repair or replacement of the other driver’s property, such as their car, that you damaged in an accident.

Collision Coverage

When you are shopping for car insurance, you will hear the term “collision coverage” a lot. But what exactly is collision coverage? In this blog post, we will explain collision coverage and how it can help you if you are in a car accident.

Collision coverage is an optional type of car insurance that helps pay to repair or replace your car if it is damaged in a collision with another vehicle or object. If you have collision coverage and you are in an accident, your insurance company will pay for the repairs to your car up to the amount specified in your policy. If the cost of repairs exceeds the amount of your coverage, you will be responsible for paying the difference.

If your car is totalled in an accident, meaning it is not repairable, collision coverage will also pay you the actual cash value of your car, up to the limit specified in your policy.

Collision coverage is not required in most states, but it is required if you have a car loan or lease. This is because your lender will want to make sure their investment is protected in case of an accident.

If you are considering buying collision coverage, you should first consider the value of your car. If your car is old or not worth very much, collision coverage may not be worth the cost. You can get an idea of your car’s value by checking its Kelley Blue Book value.


The Basics of health insurance when you buy a car, you are automatically insured against losses due to damage to the car. This insurance is usually provided by a car manufacturer or an insurance company that specializes in car insurance. If you are involved in an accident, your car insurance will provide financial assistance to cover the costs of repairs or replacement of the car. In most cases, your car insurance will also cover your legal costs.