Having trouble understanding your auto insurance policy? Trying to understand your auto quote? Need definitions for auto insurance terms?

Let’s Get You Up to Speed on the Basics

A basic auto insurance policy is made up of five different kinds of coverage:

1. Bodily Injury Liability
2. Property Damage Liability
3. Medical Payments Coverage or Personal Injury Protection
4. Uninsured & Under insured Motorist Coverage
5. Physical Damage Coverage (Collision and Comprehensive)

Depending on the state where you live, you will find difference as to what is the legally required minimum coverage that you need.

All states require that you have some form of liability insurance when operating a motor vehicle. The basic insurance policy covers Bodily Injury Liability and Property Damage Liability. These coverages provide protection if you are found legally responsible for the injury or death of another person resulting from a car accident. Minimum auto insurance policy coverage amounts vary from state to state.

Medical Payments (or “Med Pay”) is an optional coverage that covers medical expenses for you and your passengers if injured in an accident (regardless of fault). Some states require that you carry Personal Injury Protection (a broader form of Med Pay that may include income replacement and disability benefits). Like Bodily Injury Liability, the amount of Med Pay you can purchase also varies from state to state.

Physical Damage Coverage, which is also optional, includes Collision and Comprehensive coverage. Basically, these two coverages protect your own vehicle from fire, theft (including contents), vandalism, or an upset with another vehicle or object – how much or how little you get depends on the value of what you’ve got.

Uninsured & Underinsured Motorist Coverage protects you and your passengers from people driving around with little or no insurance (or hit-and-run motorists). This coverage is required in many states.

Get Savvy, Then Shop Around

Just a tiny bit of research about ways to save on auto insurance will lead you to the single most simple, quick and painless way to cut your car insurance bill:

Get Multiple Auto Insurance Policy Quotes

But what’s the use of getting those quotes if you have no idea what you’re being offered?

How can you compare different quotes if you don’t understand the difference in coverage?

You can’t. The best way to learn is to go to a website that specializes in providing auto insurance policy information, such as the learning center at InsWeb.com. You can find out everything you need to know, and you can use their free online quote service to get instant rates from as many major insurance companies as you want. This lets you compare prices for the coverage you need. And it doesn’t cost a thing.