What does car insurance cover?

Car insurance covers the costs if you hurt someone or damage their property with your car. If you get hurt in an accident, car insurance can also cover your medical expenses, and depending on the coverage in your policy, it can also cover damage to your own vehicle when you are and aren’t driving, like if you back into a telephone pole or a tree branch falls on your car.

What’s covered by a basic car insurance policy?

Every car insurance policy is made up of multiple coverage types, all of which provide different kinds of protection. When you buy car insurance, you choose the coverages you want and the limits or deductibles for each. The more coverage you choose, the more protection you’ll have, but your rates will be higher too. 

Coverage type	What it covers
Bodily injury liability	Medical bills if you've injured someone in an accident
Property damage liability	The cost of property damage you've caused in an accident
Personal injury protection	Medical expenses for you or your passengers after an accident
Uninsured/underinsured motorist	The costs if you're in an accident caused by a driver with little or no car insurance
Comprehensive	Damage to your car that happens when you're not driving
Collision	Damage to your car after a car accident, no matter who was at fault

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What does liability insurance cover? 

Liability coverage covers the costs you’re responsible for when you cause an accident. It’s made up of two parts: Bodily injury liability (BIL), which covers the other party’s medical expenses after an accident, and property damage liability (PDL), which covers damage to their car, like a smashed bumper. 

To use liability coverage, the injured party, meaning the other driver, will file a claim with your car insurance, who will work with that person to make sure their damage is paid for.

You are only covered up to the limits of your policy but, if you travel out of state and you have less than the minimum required amount of coverage, your insurance company will increase your coverage amount to make sure you meet the legal requirements to drive there.

➞ Learn more about how liability coverage works

What does personal injury protection (PIP) cover?

Personal injury protection (PIP), also called no-fault coverage, helps cover the costs when you or any of the passengers in your car are injured in an accident. Covered medical expenses may include surgeries and X-rays, as well as bills from hospitals, dental offices, and nursing services. Medications may also be covered, as well as prosthetic devices and hearing aids.

PIP can pay for costs even beyond your medical expenses, like lost wages if you can’t work, or even funeral expenses. PIP is required in so-called no-fault states, where drivers get compensation for injuries after a car accident through their own car insurance company, as opposed to through the at-fault party’s car insurance company.

➞ Learn more about how personal injury protection works

What does uninsured/underinsured motorist coverage cover?

Uninsured/underinsured motorist coverage covers the costs if someone hits you and can’t cover the costs, either because they don’t have car insurance or because they don’t have enough car insurance. 

Like liability insurance, uninsured and underinsured motorist coverage is split into separate coverage for property damage and bodily injury. 

➞ Learn more about how uninsured and underinsured motorist coverage works

What does comprehensive coverage cover?

Comprehensive coverage covers the kinds of damage that can happen to your car that aren’t a collision. That means events out of your control, such as damage from:

• Extreme weather (Flood, lightning, hurricane)

• Fire

• Falling objects (Hail, tree branches)

• Riots

• Vandalism (slashed tires)

• Animals (hitting a deer, rodent damage)

• Theft

• Glass damage and windshield replacement

Comprehensive and collision insurance often go hand-in-hand, and together, they cover damage to your own vehicle, from basic scratches to totaling your car. 

➞ Learn more about how comprehensive coverage works

What does collision coverage cover?

Collision coverage covers damage to your car from a collision, no matter who was at fault. That includes damage from:

• Crashing into another car

• Running into a stationary object, like a tree

• Driving over a pothole

It is important to tell your insurance company if you have any modified parts on your car, like a mod exhaust, so they can include it in your coverage (for an additional fee.) If you don't let them know about any vehicle modifications, they won't be covered if you're in an accident.

➞ Learn more about how collision coverage works

What does gap insurance cover?

When your car is stolen or destroyed, your car insurance will pay for the actual cash value of your car. If you loan or lease your car, and it’s totaled in an accident, you could end up owing more on your loan or lease than your car’s depreciated value. Gap insurance pays out the difference between the car’s actual cash value and the amount you still owe on the lease or loan. 

➞ Learn more about how gap insurance works

What about additional coverage options?

In addition to the standard coverage that makes up a full coverage policy, most major car insurance companies offer a variety of extra coverage options that can be added to your policy with a rider or endorsement. Those may include:

• Roadside assistance: When you’re stranded on the side of the road, roadside assistance can cover emergency services, like a flat-tire change, jump start, locksmith, or towing. Your policy may automatically include roadside assistance if you have comp and collision coverage, but if it doesn’t, you can usually add it for $5-$15 per vehicle.

• New car replacement coverage: When your car is stolen or destroyed, your car insurance will cover a replacement up to the actual cash value of your car. New car replacement coverage pays to replace your totaled car with one of a similar make and model, but it’s usually only available if your car is less than two years old.

• Rental reimbursement coverage: When your car is being repaired in a shop, rental reimbursement coverage can pay for a rental car in the meantime. Rental reimbursement usually has a per-day limit and a total limit.

➞ Learn more about how to figure out how much car insurance you need

What does car insurance not cover?

Your car insurance policy will tell you what kinds of accidents and damage are covered as well as what isn’t. Car insurance typically doesn’t cover:

• Regular repairs and maintenance: Repairs that result from regular wear and tear and maintenance issues are not covered, so routine oil changes or a leaky radiator wouldn’t be covered by car insurance. Other routine issues like inspections also are not covered by insurance.

• Ridesharing: Some policies may differ, but your car insurance policy may exclude claims for damage caused while driving for fares. For that, you’ll need to speak to your insurer about adding rideshare coverage. 

• Damage that exceeds your coverage limits: When you purchase car insurance, you’ll choose how much of each coverage you want. Your car insurance company is obligated to cover you up to your liability limits, but damage that exceeds that amount will not be covered.

• Exotic and performance cars: Exotic, performance, and vintage cars that are expensive to replace or repair are generally not by standard auto insurance companies. Check with your insurer to see whether you can get coverage for your Lamborghini, but you may find you have to shop at specialty insurers and get a separate policy entirely.

• Certain perils: Some causes of damage are not covered, including intentional damage, damage from street racing or damage from acts of war.  Also, coverage may depend on the type of car you drive. For example, most insurance policies only cover off road driving if your car was designed to be used off road.

• Excluded drivers: Drivers who are specifically excluded from your coverage in your policy will not be covered if they get into an accident while driving your car. This is also true for drivers who have not been given permission to drive your car. 

• Mechanical damage: Things like engine failure and electrical issues aren't covered by your car insurance unless they are caused by a covered peril. Similarly, if you need a rental car while your vehicle is being repaired, that isn't covered unless the damage was caused by a covered peril.