When you buy an auto insurance policy, you are buying a package of individual coverages. Each coverage protects you against different types of losses. Once you understand the various coverages, you can decide which ones to include in your personal insurance package. You can also determine the limits of coverage you will need. The following are some common coverages found in an auto policy. NOTE - Your policy may not contain all of these coverages.
Bodily Injury (BI) Liability Coverage pays, up to the coverage limits, for damages due to injury or death of others in a vehicle accident for which you or the operator of your vehicle are legally responsible. It also pays your legal defense costs. In most states this coverage is mandatory.
Property Damage (PD) Liability Coverage pays, up to the coverage limits, for another individual's vehicle or property that has been damaged in an accident for which you or the operator of your vehicle is legally responsible. In most states this coverage is also mandatory.
Medical Payments Coverage pays, up to the coverage limits, for reasonable and necessary doctor, hospital and funeral expenses for you and your passengers injured or killed in an accident, regardless of who is at fault. Payments are usually limited to one to three years after the accident. This coverage is optional in most states without no-fault insurance systems.