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What Coverage Do I Need? 8 Elements To Consider

Understanding the 8 primary elements that make up any solid low cost car insurance package will help you determine exact dollar coverage in the event of an accident. When buying car insurance in NJ, PA or MD, you should always examine how much protection you need in each of these categories. While some may be forfeited due to individual circumstances, it is advisable to balance cost of coverage against out-of-pocket repair or replacement costs. We have outlined below simple explanations for each category to help you become better informed when making your decision about how much coverage you need.

Bodily Injury:

Bodily injury coverage pays for any medical treatment, rehabilitation or funeral costs sustained by another driver, his/her passengers, your passengers and/or pedestrians if you are found at fault for causing an accident. This coverage also pays for legal and settlement costs for pain and suffering claims.

Personal Assets:

When considering Bodily Injury coverage for low cost car insurance you will need to determine what assets need protecting and at what dollar amount. Individuals with few assets may not require as much coverage as individuals with higher dollar-valued assets such as investments, real estate and substantial savings.

Property Damage Liability:

If you cause an accident, this coverage pays for the other driver’s vehicle or property repairs or replacement, as well as property that may be damaged from the accident. It is essential to consider how much you can afford to pay out-of-pocket should the valuation for repairs exceed your coverage amount. Case in point: if you only have $10,000 in coverage and hit a new Mercedes worth $80,000, can you afford to make up the $70,000 shortfall?


Collision coverage pays out the full value of your vehicle regardless of at-fault status for drivers covered under your auto policy. Again, coverage should be calculated on how much deductable you can afford to pay out-of-pocket if you are in an accident. If your car is old, you may want to eliminate this coverage altogether, which can save on premiums. All financed or leased vehicles require collision coverage.


This coverage pays for repairs or replacement of your car if it has been damaged due to wind, flood, fire, vandalism, animal collision, or if it has been stolen. Much like Collision coverage, if your car is new, financed, or leased you will want to buy adequate coverage for repairs or replacement. Again, possible out-of-pocket expenses above and beyond any deductible should be taken into account. If your car is older, and fully owned, this could be another category you may not need to buy.

Personal Injury Protection:

Often referred to as PIP, this coverage pays First Party Medical Payment Benefits to physicians, hospitals, rehabilitation costs, convalescent services and some funeral costs for you and the listed drivers on your policy if an accident occurs.

Uninsured/Underinsured Motorist:

As the category implies, this coverage pays for damages incurred by either a hit-and-run driver where a police report is filed or someone who may be underinsured if he/she causes an accident.