Car Insurance in North Carolina

Automobile Insurance

An auto insurance policy is package of several different types of insurance. Each type of insurance protects against various losses. When selecting a policy, you need to understand these individual components of a complete insurance package in order to select a plan that is right for you. The common types of coverage found in an auto insurance policy are listed below. Please note that your policy may not include all of the coverage’s listed below. All of these coverages pay up to the specified coverage limits.

Bodily Injury (BI) Liability Coverage – This coverage is mandatory in most states. It will pay damages due to injury or death of other persons in a vehicle for any accident in which you or another driver of your vehicle is legally responsible. This coverage will also pay for your legal defense.

Property Damage (PD) Liability Coverage – This coverage is also mandatory in most states. It will pay for damages to another person’s vehicle or property that has been damaged in an automobile accident in which you or another driver of your vehicle is legally responsible.

Medical Payments Coverage – This covers reasonable medical and funeral expenses that result from an automobile accident, for you and your passengers regardless of who is at fault. This coverage is optional for most states without no-fault automobile insurance systems.

Uninsured/Underinsured Motorists (UM/UIM) Coverage – This coverage pays up to the insurance coverage limits for pain and suffering which is not covered by medical, disability and PIP. Underinsured motorist insurance coverage pays for bodily injury to you or your family resulting from the negligence of someone who’s automobile liability insurance limits are insufficient. The definition of an underinsured motorist varies from state to state.

Collision Coverage – This covers damages to your vehicle, or to a vehicle you are driving if you are involved in a collision or a rollover. Most lenders will require this coverage with a vehicle loan.

Comprehensive Coverage – This coverage helps pay for damages not caused by a collision, and may include damages caused by falling objects, fire, storms or natural disasters, vandalism, animals, and other perils. It does not cover damages from a collision or rollover (these require collision coverage). Most lenders will require this coverage with a vehicle loan.

Rental Reimbursement – If your vehicle is being repaired for damage that is covered by your policy, a rental reimbursement plan will pay for a rental vehicle (up to a specified limit) while your vehicle is being repaired. This coverage is optional, and may be a good idea if you cannot afford to be without a vehicle in the event of an accident.