Examining Auto Insurance Coverage

If you drive, you need auto insurance coverage. But just exactly which type of coverage should you have, and which ones are you required to have? Following are the key features of auto insurance (depending on your unique circumstances, you may or may not need all these features):

• Collision: If you’re in an automobile accident, regardless of who is at fault, collision insurance provides protection to replace or repair your vehicle, subject to a deductible.
  
  
• Comprehensive: In the event of hail damage or a tree limb falling on your car (risks not involving an automobile collision), this coverage insures you. Comprehensive coverage pays to repair your vehicle, subject to a separate deductible.
  
  
• Personal injury protection: This type of insurance coverage is for medical and other expenses resulting from an automobile accident for the people specified in the policy, regardless of who is at fault in the accident.
  
  
• Medical payments: This feature provides a limited amount of coverage for you and your passengers’ medical expenses as a result of an accident. The coverage pays regardless of who is at fault.
  
  
• Bodily injury and property damage liability coverage: The insurer agrees to pay damages if you injure someone or his property in an auto accident.
  
  
• Uninsured and underinsured motorists liability coverage: If you’re in an accident with another driver who doesn’t carry any or enough liability coverage, uninsured or underinsured motorists liability coverage allows you to collect damages that you personally experience from the accident.
  
  
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Liability Coverage

Liability coverage is offered for bodily injury (BI) or property damage (PD) for which the insured driver is deemed responsible. The amount of coverage provided (a fixed dollar amount) will vary from jurisdiction to jurisdiction. Whatever the minimum, the insured can usually increase the coverage (prior to a loss) for an additional charge.

An example of Property Damage is where an insured driver (or 1st party) drives into a telephone pole and damages the pole, liability coverage pays for the damage to the pole. In this example, the drivers insured may also become liable for other expenses related to damaging the telephone pole, such as loss of service claims (by the telephone company), depending on the jurisdiction. An example of Bodily Injury is where an insured driver causes bodily harm to a third party and the insured driver is deemed responsible for the injuries. However, in some jurisdictions, the third party would first exhaust coverage for accident benefits through their own insurer (assuming they have one) and/or would have to meet a legal definition of severe impairment to have the right to claim (or sue) under the insured driver's (or 1st Party's) policy.
In some jurisdictions Liability coverage is available either as a 

Combined Single Limit Policy 

A combined single limit combines property damage liability coverage and bodily injury coverage under one single combined limit. For example, an insured driver with a combine single liability limit strikes another vehicle and injures the driver and the passenger. Payments for the damages to the other driver's car, as well as payments for injury claims for the driver and passenger, would be paid out under this same coverage. 

Splits Limit Policy 

Split limit liability coverage policy splits the coverages into property damage coverage and bodily injury coverage. Payments for the other driver's vehicle would be paid out under property damage coverage, and payments for the injuries would be paid out under bodily injury coverage. Bodily injury liability coverage is also usually split as well into a maximum payment per person and a maximum payment per accident.  

In the state of Oklahoma, you must carry at least state minimum liability limits of $25,000/50,000/25,000. If an insured driver hits a car full of people and is found by the insurance company to be liable, the insurance company will pay $25,000 of one persons medical bills but will not exceed 50,000 for other people injured in the accident. The insurance company will pay property damage not to exceed 25,000 in repairs to the vehicle that the insured hit.  

In the state of Indiana, the minimum liability limits are $25,000/$50,000/$10,000 so, there is a greater property damage exposure for only carrying the minimum limits.