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General Liability
General liability insurance covers injuries/deaths
and property damage resulting from an accident.
This is the most important coverage and is commonly
required by law in many states. Each state has
its own minimum liability requirement. Some insurance
companies offer "split-limit" coverage (each part
of the coverage is split into its own limit, i.e.
$15,000 max. per person injured, $5,000 for property,
etc.) while others offer "combined single limit" (the
entire combined coverage for bodily and physical
damages under one limit, i.e. $100,000 total).
Typically, liability is presented in three numbers
(each representing dollars in thousands):
For example, 15/30/5 represents (for one accident) $15,000 per person injured, $30,000 maximum for all people injured, and $5,000 total for property damage. General liability coverage should be equal to your net worth: this will help prevent dipping into your personal accounts and assets for any "spill-over."
Medical Payments
This "good-faith" coverage guarantees immediate medical
payments for you, your passengers and other parties,
regardless of who is at fault. It also covers you and
members of your household in any accident involving
an automobile, whether you are on foot, on a bicycle,
in a friend's car, etc.
Collision
Collision insurance covers damage to your own vehicle
in an accident. Collision is generally optional
unless your car is financed or leased in which
case your bank or credit union, bank or lender
will require collision coverage as a condition
of the loan in order to protect their interests.
Comprehensive
Comprehensive insurance covers damage to your vehicle
other than collision, such as fire, flood, break-ins,
vandalism or theft, vandalism, break-ins, collisions
with animals, and fire. It also covers natural
disasters like earthquakes, hail, hurricanes and
floods (unless the vehicle is overturned, in which
it's considered a collision). Like collision, comprehensive
insurance is usually required if your car is leased
or financed.
Uninsured/Underinsured Motorist
Uninsured or underinsured motorist insurance covers
you if you are injured in an accident with others
who themselves carry insufficient or no liability
insurance. With the surprising number of such drivers
out there, it's a good idea to have some. Some
states require UIM/UM, so contact your Agent.