Compare Car Insurance by Coverage Type [2024]

Car insurance is a critical aspect of owning a vehicle. Not only is it required by law in most states, but it can also provide financial protection in the event of an accident. Many types of car insurance coverage are available, so it can be confusing to know which is right for you. 

This article will help break down the different types of car insurance so you can decide what’s best for your needs. We’ll cover liability insurance, comprehensive coverage, collision coverage, and more.  We’ll also help you compare car insurance by coverage type.

So whether you’re a first-time buyer or just looking to brush up on your knowledge, read on for all you need to know about auto insurance.

What are the most common types of car insurance?

There are several common types of car insurance coverage available. Here’s a breakdown of the most frequently purchased options:

• Liability
• Collision 
• Comprehensive
• Uninsured/Underinsured Motorist
• Personal Injury Protection (PIP)
• Medical Payments (MedPay)

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Liability Car Insurance

Liability auto insurance coverage covers the cost of any injuries or damage you may cause to another person or their property while operating a vehicle. It also provides legal defense if you face a lawsuit due to an accident.

What does liability insurance cover?

Liability insurance covers the cost of the following:

• Medical bills
• Property damage
• Legal fees
• Lost wages
• Rehabilitation
• Other expenses for the injured party

Depending on your policy type, your liability insurance may also cover any punitive damages that a court may award. It’s important to note, however, that there are limits to what liability insurance will pay for. For example, most policies will not cover intentional acts of violence.

Who should get liability insurance?

Most states require a minimum level of liability insurance to operate a vehicle. Therefore, all drivers need at least the minimum required coverage in case of an accident. 

However, depending on your circumstances and the value of your assets, you may also want to consider purchasing higher limits or additional coverage to protect yourself financially.

Collision Car Insurance 

Collision car insurance covers vehicle damage resulting from a collision with another car or object. It can also cover damage caused by flipping or rolling your vehicle.

What does collision insurance cover?

Collision insurance covers the costs of the following:

• Repairing or replacing your vehicle
• Rental car fees while your vehicle is under repair
• Repairing or replacing any accessories or custom parts damaged in the collision

Who should get collision insurance?

If you have a newer or more expensive vehicle, collision insurance may be worth it in case of an accident. It can also benefit high-risk drivers, who may have a higher chance of being involved in an accident. 

It’s important to note that collision insurance typically has a deductible, which is the amount you are responsible for paying before your insurance coverage kicks in. There may also be limits on the maximum amount your policy will pay for repairs.

Comprehensive Car Insurance

Comprehensive car insurance covers damage to your vehicle from non-collision-related incidents.

What does comprehensive insurance cover?

This type of insurance covers damage or loss to your car from incidents such as:

• Theft
• Vandalism
• Natural disasters
• Falling objects
• Fire
• Animal collisions

Who should get comprehensive insurance?

Comprehensive insurance may be worth considering if your vehicle is at risk for damage from events unrelated to a collision, such as theft or natural disasters. For instance, if you live in an area prone to certain incidents or your vehicle has expensive accessories, comprehensive insurance may provide valuable coverage. (For more information, read our “compare assigned risk car insurance“).

Uninsured/Underinsured Motorist Coverage (UM/UIM)

This type of coverage pays your expenses if you get into an accident caused by a driver who doesn’t have insurance or doesn’t have enough insurance. 

According to the Insurance Information Institute (III), about 12.6% of drivers in the U.S. are uninsured. Mississippi has the highest percentage of uninsured drivers at 29.4%.

What does UM/UIM cover?

Uninsured/underinsured motorist coverage can help pay for medical expenses, property damage, lost wages, and pain and suffering. Remember that each state has laws governing what types of expenses UM/UIM coverage will and will not cover. So be sure to check with your insurance agent to see what is included in your policy.

Medical Expenses

If you suffer an injury in an accident, UM/UIM can help pay for your hospital bills, doctor’s visits, prescriptions, and other medical costs.

Property Damage

If your car is damaged or totaled in an accident, UM/UIM can help pay to repair or replace it.

Lost Wages 

If you miss work because of your injuries, UM/UIM can help reimburse you for lost wages up to a certain amount.

Pain and Suffering 

UM/UIM can also help pay for “non-economic damages” such as pain and suffering in some states.

Who should get UM/UIM coverage?

Anyone who wants protection against the financial devastation an uninsured or underinsured driver can cause should consider getting UM/UIM coverage. Even if you don’t live in a state with a high percentage of uninsured drivers, getting this coverage is still a good idea. 

Personal Injury Protection (PIP)

Personal injury protection, also known as PIP insurance, covers the medical expenses and lost wages for you and your passengers in the event of an accident, regardless of who is at fault.

What does PIP cover?

PIP insurance generally covers

• Medical expenses
• Lost wages
• Funeral expenses
• Other necessary services, such as childcare or household help during recovery

Who should get PIP insurance?

PIP insurance is often a requirement in no-fault insurance states, where fault for an accident does not determine who covers medical expenses. PIP coverage can also be helpful if you do not have adequate health or disability insurance.

However, it’s important to note that PIP insurance typically has a maximum limit on the amount it will cover. It may also not cover all medical expenses, such as long-term or ongoing care.

Medical Payments (MedPay) Coverage

MedPay coverage is insurance that helps cover medical expenses for you and your passengers after an accident, regardless of who is at fault. MedPay is not a requirement in all states, but it is available in most.

What does MedPay cover?

MedPay coverage can help pay for various medical expenses related to an accident, including hospital stays, ambulance rides, surgeries, and doctor’s visits.

One thing to remember is that MedPay coverage is different from health insurance. Health insurance typically has a deductible you must pay before coverage kicks in, but MedPay does not. 

This means you can use your MedPay benefits even if you have not yet met your health insurance deductible.

Who should get MedPay coverage?

Residents of Maine and New Hampshire are required to have MedPay coverage. Still, it’s a good idea for anyone to consider getting it. That’s because MedPay can help cover expenses that your health insurance may not cover.

How does MedPay differ from PIP coverage?

PIP, or personal injury protection, is similar to MedPay in that it helps cover medical expenses for you and your passengers after an accident. 

However, PIP also covers lost wages and essential services (such as house cleaning or child care) that may be necessary during your recovery. 

PIP is a requirement in 12 states: Utah, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New York, Florida, North Dakota, Oregon, New Jersey, and Delaware. MedPay is mandatory in only two states: New Hampshire and Maine.

Readmore: How much does PLPD insurance cost in Michigan?

What are the other types of car insurance coverage?

In addition to the coverage described above, several other types of car insurance are available. These include:

SR-22 Insurance

Also known as a “certificate of financial responsibility,” SR-22 car insurance is not a type of insurance but a form that must be filed with your state by your auto insurance company. It verifies that you have the minimum required auto insurance coverage.

Rental Reimbursement Coverage

If you need to rent a car while yours is being repaired or replaced after an accident, rental reimbursement coverage can help pay for those expenses.

Gap Insurance

Gap insurance helps cover the gap between the value of your car and what you still owe on it if your car is totaled or stolen.

Umbrella Insurance

Umbrella insurance can provide additional liability coverage above and beyond your auto insurance policy limits. This can be useful if you are sued for an accident and found to be at fault.

Non-Owner Car Insurance

Non-owner car insurance provides liability coverage for individuals who do not own a vehicle but may occasionally drive or rent one.

Mechanical Breakdown Insurance (MBI)

Mechanical breakdown insurance helps cover the cost of repairs for mechanical or electrical failures that occur after the manufacturer’s warranty on a new car has expired.

Usage-Based Insurance (UBI)

Also known as telematics or pay-as-you-drive insurance, UBI programs monitor your driving behavior (such as mileage, speed, and sudden stops) to determine your car insurance rates. 

Emergency Roadside Assistance

Emergency roadside assistance provides services that help you get back on the road if your car breaks down due to mechanical or other failures. These include towing, battery jump-starts, tire changes, and fuel delivery.

Final Thoughts on the Types of Car Insurance

There are many types of car insurance with varying levels of coverage. Liability insurance is the most common type of car insurance, followed by collision and comprehensive. 

Other forms of auto insurance include Personal Injury Protection (PIP), Uninsured/Underinsured Motorist Coverage, MedPay Coverage, etc. 

It’s important to understand the different types of car insurance coverage to ensure you have adequate protection for yourself and your vehicle.