What most people don't understand about car insurance

sand small There are many aspects of car insurance which contain various different endorsements. The first is called "Bodily Injury Liability". This essentially protects your assets in the event that you cause an accident. The second is "Personal Injury Protection". New Jersey is a "No-Fault" state which means regardless of who caused the accident, your insurance pays your medical bills and the other driver's insurance company pays their medical bills. On a standard policy, this affords $250,000.00 worth of coverage.

The third most significant part of auto insurance and the one that really is the best bang for the buck is the 'Uninsured Motorist or Underinsured Motorist Bodily Injury" [UM/UIM].  This protects your body and your family's body in the event of injuries.  New Jersey requires a mandatory minimum bodily injury coverage of $15,000.00 per person/$30,000.00 per accident.  Most drivers carry only this amount of coverage.  If you had $100,000.00 of UM/UIM, you would receive the $15,000.00 from the other driver who caused the accident and up to another $85,000.00 on your underinsured motorist coverage.  Similarly, if the driver that struck you was uninsured and you had $100,000.00 UM/UIM, you could receive up to $100,000.00 from your own insurance company.  There are other endorsements, such as, essential services, income continuation, comprehensive and collision which simply provide other coverage to you. This article will deal with the three most important coverages: bodily injury, PIP and UM/UIM.

Bob Sandman
click the above image to view a helpful mark up of an example insurance policy translation.

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