{"id":5713,"date":"2021-07-02T06:51:00","date_gmt":"2021-07-02T06:51:00","guid":{"rendered":"https:\/\/www.freeway.com\/knowledge-center\/?p=5713"},"modified":"2023-09-22T05:35:26","modified_gmt":"2023-09-22T05:35:26","slug":"what-is-car-insurance","status":"publish","type":"post","link":"https:\/\/www.freeway.com\/knowledge-center\/auto\/what-is-car-insurance\/","title":{"rendered":"What Is Car Insurance?"},"content":{"rendered":"\n<p>When you get a new car, you\u2019ll need <a href=\"https:\/\/www.freeway.com\/auto-insurance\/\">car insurance<\/a> to drive legally. But just what is car insurance?<\/p>\n\n\n\n<p>You might not know for sure, especially if this is your first vehicle. And just knowing that you need it isn\u2019t enough. You really should understand how it works so you can pick the coverage that\u2019s right for you.<\/p>\n\n\n\n<p>Below, we\u2019ll explain what car insurance is and how it works so you can feel comfortable choosing the best car insurance for your needs.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-is-car-insurance\">What Is Car Insurance?<\/h2>\n\n\n\n<p>Car insurance is a type of coverage that protects you against financial loss related to your car. It reimburses you if you\u2019re in an accident or if your car is stolen. In exchange for this reimbursement, you\u2019ll need to pay a monthly premium to the insurance company.<\/p>\n\n\n\n<p>There are different <a href=\"https:\/\/www.freeway.com\/auto-insurance\/coverage\/\">types of car insurance<\/a>. This lets you pick just the kind of coverage you need based on your state\u2019s laws and your personal preferences.<\/p>\n\n\n\n<p>Nearly every state requires you to have bodily injury liability coverage and property damage liability coverage:<\/p>\n\n\n\n<ul><li><strong>Bodily injury liability coverage<\/strong> will cover costs for any injuries or deaths you or someone driving your car causes.<\/li><li><strong>Property damage liability coverage<\/strong> will cover costs for any property damage you or someone driving your car causes.<\/li><\/ul>\n\n\n\n<p>Remember, those two types of coverage are for if you\u2019re at fault in an accident. This means you are the person that caused the accident. By requiring this insurance, states can make sure you\u2019ll be liable if you hit someone.<\/p>\n\n\n\n<p>While these are the main two types of coverage, they aren\u2019t the only ones. You may want to take out additional insurance to protect yourself, your passengers, and your car if you\u2019re in an accident. Some other popular auto insurance coverages include:<\/p>\n\n\n\n<ul><li><strong>Medical payments or personal injury protection (PIP).<\/strong> This covers costs for medical bills for you or your passengers if you\u2019re in an accident.<\/li><li><strong>Uninsured motorist coverage.<\/strong> This covers costs if you\u2019re in an accident caused by a driver without insurance.<\/li><li><strong>Collision coverage.<\/strong> This covers costs for damage to your car if you are at fault for an accident.<\/li><li><strong>Comprehensive coverage.<\/strong> This covers costs for damage to your car from something other than a collision, like a fire or a flood.<\/li><li><strong>Glass coverage.<\/strong> This covers costs for damage to your windshield, like a crack or chip.<\/li><\/ul>\n\n\n\n<p>About <a href=\"https:\/\/www.insurance-research.org\/sites\/default\/files\/downloads\/UM%20NR%20032221.pdf\" target=\"_blank\" rel=\"noopener\">12.6% of U.S. drivers<\/a> were uninsured as of 2019. As you can already see, this is a bad idea, as insurance provides a valuable resource for drivers after a collision.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-how-does-car-insurance-work\">How Does Car Insurance Work?<\/h2>\n\n\n\n<p>Are you still asking yourself, \u201cwhat is car insurance, and how does it work?\u201d Don\u2019t worry. We\u2019ll go more in-depth now so you can understand how car insurance protects you.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-how-car-insurance-works-if-you-are-at-fault\">How Car Insurance Works If You Are at Fault<\/h3>\n\n\n\n<p>Let\u2019s imagine a scenario. You\u2019re driving on the highway, and you accidentally merge into another car while trying to switch lanes. It\u2019s just a fender bender, but both cars have some damage that will need to be repaired.<\/p>\n\n\n\n<p>Since you\u2019re at fault, you\u2019ll need to report the accident to your insurance. The other driver will also call their insurance so they can file a claim with your insurance company.<\/p>\n\n\n\n<p>Your insurance company will then pay for the repairs to the other driver\u2019s car. This is what your liability coverage is for.<\/p>\n\n\n\n<p>But what about your car? If you have collision coverage, you can also make a claim with your insurance to get the damages covered. First, though, you\u2019ll need to pay a deductible.<\/p>\n\n\n\n<p>A deductible is a set amount of money you need to pay every time you\u2019re in an accident. <a href=\"https:\/\/www.iii.org\/article\/understanding-your-insurance-deductibles\" target=\"_blank\" rel=\"noopener\">An average deductible is usually $500<\/a>, so if your car costs less than that to fix, you probably shouldn\u2019t turn your damages over to insurance.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-how-car-insurance-works-if-you-re-not-at-fault\">How Car Insurance Works If You\u2019re Not at Fault<\/h3>\n\n\n\n<p>Now, imagine it was the other car who merged into you. Clearly, you are not at fault in this situation. As long as the driver doesn\u2019t <a href=\"https:\/\/www.freeway.com\/knowledge-center\/auto\/what-to-do-after-hit-and-run-accident\/\">hit and run<\/a>, you should exchange insurance information.<\/p>\n\n\n\n<p>Once you have their insurance information, the first thing you\u2019ll want to do is call your insurance company. They\u2019ll ask you for details about the accident, and they may ask you to provide documentation like pictures or a police statement. This helps them verify you weren\u2019t the one that caused the collision.<\/p>\n\n\n\n<p>After the at-fault driver\u2019s insurance company verifies they were the one who caused the accident, they\u2019ll pay for repairs to your vehicle. But what if the other driver doesn\u2019t have insurance?<\/p>\n\n\n\n<p>This is where your uninsured motorist coverage would kick in. After you pay your deductible, your insurance will cover repairs to your vehicle.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-does-car-insurance-cover\">What Does Car Insurance Cover?<\/h2>\n\n\n\n<p>What auto insurance covers all depends on the type of insurance you have picked out. Let\u2019s take a look at the different types of scenarios car insurance will cover based on the type of coverage.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-liability-coverage\">Liability Coverage<\/h3>\n\n\n\n<p>When you cause an accident, with liability, you can get coverage for:<\/p>\n\n\n\n<ul><li>Damage to vehicles<\/li><li>Damage to objects<\/li><li>Injuries to drivers<\/li><li>Injuries to passengers<\/li><li>Legal fees if you are sued over an accident<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-comprehensive-coverage\">Comprehensive Coverage<\/h3>\n\n\n\n<p>With comprehensive, you can get coverage for damage that\u2019s out of your control, like:<\/p>\n\n\n\n<ul><li>Hitting an animal<\/li><li>Vandalism<\/li><li>Falling trees<\/li><li>Wind damage<\/li><li>Flood damage<\/li><li>Theft<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-collision-coverage\">Collision Coverage<\/h3>\n\n\n\n<p>With collision, you can get coverage during several incidents, including:<\/p>\n\n\n\n<ul><li>Hitting a guardrail or street sign<\/li><li>Flipping your vehicle over<\/li><li>Hitting another car<\/li><li>Being in a hit and run<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-medical-payments-coverage\">Medical Payments Coverage<\/h3>\n\n\n\n<p>With medical payments or PIP, you can be covered for:<\/p>\n\n\n\n<ul><li>Medical bills for yourself<\/li><li>Medical bills for your passengers<\/li><li>Lost wages if you can\u2019t work due to injury<\/li><li>Disability and rehab costs<\/li><li>Death benefits<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-uninsured-motorists-coverage\">Uninsured Motorists Coverage<\/h3>\n\n\n\n<p>Depending on the type you get, uninsured motorist coverage can offer:<\/p>\n\n\n\n<ul><li>Payment for medical bills for you and your passengers<\/li><li>Payments for damage to your vehicle<\/li><\/ul>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1000\" height=\"667\" src=\"https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance.jpg\" alt=\"Happy family riding in a car with insurance\" class=\"wp-image-5715\" srcset=\"https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance.jpg 1000w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-300x200.jpg 300w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-768x512.jpg 768w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-960x640.jpg 960w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-750x500.jpg 750w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-294x196.jpg 294w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-320x213.jpg 320w, https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2021\/07\/do-i-need-car-insurance-285x190.jpg 285w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><\/figure><\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-doesn-t-car-insurance-cover\">What Doesn\u2019t Car Insurance Cover?<\/h2>\n\n\n\n<p>There are a few instances where your car insurance won\u2019t cover you. As an example, a normal car insurance policy won\u2019t cover you if you\u2019re in an accident while using your car for business. That\u2019s because a <a href=\"https:\/\/www.freeway.com\/insurance-options\/commercial-vehicle-insurance\/\">commercial vehicle<\/a> requires a different policy.<\/p>\n\n\n\n<p>This doesn\u2019t include driving to and from work; it means things like using your car to deliver work materials across town or being a rideshare driver.<\/p>\n\n\n\n<p>Most car insurance policies also don\u2019t cover your personal property. This means if you\u2019re in an accident and your laptop gets crunched, your car insurance won\u2019t cover that. However, if you have <a href=\"https:\/\/www.freeway.com\/insurance-options\/homeowners-insurance\/\">homeowners insurance<\/a>, you may be able to turn the loss over to them for reimbursement.<\/p>\n\n\n\n<p>If you\u2019re in doubt about what your policy does and doesn\u2019t cover, your best bet is to refer to your policy documents. You\u2019ll get these when you sign up for your insurance, and they\u2019ll go over all the fine print details about your coverage limitations.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-who-does-car-insurance-cover\">Who Does Car Insurance Cover?<\/h2>\n\n\n\n<p>Besides yourself, your auto insurance can also cover <a href=\"https:\/\/www.freeway.com\/knowledge-center\/auto\/does-car-insurance-cover-other-drivers\/\">other people driving your car<\/a>? However, it depends on the type of coverage.<\/p>\n\n\n\n<p>Collision and comprehensive coverage follow the car, meaning that your car will be protected in an accident no matter who is driving.<\/p>\n\n\n\n<p>But liability coverages follow the driver. This means that if you loan your car to a friend and get into an accident, their insurance should foot the bill.<\/p>\n\n\n\n<p>The only problem is if they are uninsured. In that case, the burden will fall on your insurance company to pay for the damages.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-happens-if-you-don-t-have-car-insurance\">What Happens If You Don\u2019t Have Car Insurance?<\/h2>\n\n\n\n<p>If you\u2019re tempted to skip out on having car insurance, think again. The <a href=\"https:\/\/www.freeway.com\/knowledge-center\/auto\/driving-without-insurance\/\">penalties for driving without insurance<\/a> are steep.<\/p>\n\n\n\n<p>Every state sets its own consequences. In Massachusetts, your first offense can cost you up to $1,000. And in New Mexico? You might face up to 90 days in jail.<\/p>\n\n\n\n<p>While other states might not have quite as severe penalties, you can rest assured they\u2019ll all fine you in some way.<\/p>\n\n\n\n<p>That said, there are two states where car insurance isn\u2019t mandatory \u2014 Virginia and New Hampshire. But in Virginia, you\u2019ll still need to pay a $500 uninsured motorist\u2019s vehicle fee. And if you\u2019re at fault for an accident in New Hampshire without insurance, you\u2019ll be legally responsible for up to $25,000 per person for bodily injury liability, up to $50,000 per accident, as well as up to $25,000 in property damage liability.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-now-you-know-what-is-car-insurance\">Now You Know: What Is Car Insurance?<\/h2>\n\n\n\n<p>Now you should be ready to get a policy for your vehicle since you know the answer to \u201cwhat is car insurance?\u201d Luckily, Freeway Insurance is here to help.<\/p>\n\n\n\n<p>Freeway\u2019s affordable auto insurance can save you big while providing the protection you need. Get your <a href=\"https:\/\/app.freeway.com\/\" target=\"_blank\" rel=\"noopener\">free quote online<\/a>, by calling us at <a href=\"tel:800-777-5620\">800-777-5620<\/a>.<\/p>\n\n\n\n<div class=\"wp-block-buttons aligncenter is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-white-color has-text-color has-background\" href=\"#modal-turbo\" style=\"background-color:#0047bb\">Get a Quote<\/a><\/div>\n<\/div>\n\n\n\n<div style=\"height:25px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div class=\"wp-block-buttons aligncenter is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-white-color has-text-color has-background\" href=\"tel:800-777-5620\" style=\"background-color:#0047bb\">Call Us<\/a><\/div>\n<\/div>\n\n\n\n<div style=\"height:25px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div class=\"wp-block-buttons aligncenter is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-white-color has-text-color has-background\" href=\"https:\/\/locations.freeway.com\/\" style=\"background-color:#0047bb\" target=\"_blank\" rel=\"noopener\">Find Your Office<\/a><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>When you get a new car, you\u2019ll need car insurance to drive legally. But just what is car insurance? You might not know for sure, especially if this is your first vehicle. And just knowing that you need it isn\u2019t enough. You really should understand how it works so you can pick the coverage that\u2019s [&hellip;]<\/p>\n","protected":false},"author":1002587,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[5],"tags":[],"importance":[],"type-content":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts\/5713"}],"collection":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/users\/1002587"}],"replies":[{"embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/comments?post=5713"}],"version-history":[{"count":14,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts\/5713\/revisions"}],"predecessor-version":[{"id":9604,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts\/5713\/revisions\/9604"}],"wp:attachment":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/media?parent=5713"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/categories?post=5713"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/tags?post=5713"},{"taxonomy":"importance","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/importance?post=5713"},{"taxonomy":"type-content","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/type-content?post=5713"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}