Policy Types

It is necessary for all car drivers to have a car insurance, and some insurance types is a must by law. The insurance policies all fall into two main categories: first party insurance and third-party liability. These categories keep the insurance intact.

The Third-Party Liability
It has two types of policies: property damage and bodily injury. The bodily injury liability is paying claims other people, for damages that a policy owner did to them. The payment is meant to cover their medical expenses, and possibly compensate for lost wages, suffering and pain. The property damage is meant to pay others for damages that have been done to their property.
The policy is effective when someone files a suit against the policy owner, because of an accident that involve the policy holder. The effectiveness is them providing monetary protection, which is limited by the policy itself.

Bodily Injury Policy
It is common for the bodily injury policy to be something like either 50 out of 100 or 100 out of 300, where first number is identified as amount of the total, if it happens that someone either gets injured or killed, while the second is seen as total amount for the accident, as a whole. This is a coverage that also include settling legal expenses, if there was a suit against the policy holder.

Property Damage Policy
The same notation that apply to bodily injury policy also apply to property damage. For example if the policy is something like 100/300/40, then the policy will offer $40,000 worth of coverage for either replacing or repairing other’s property, which also include cars.

The First-Party Policy
The first party policy is a coverage that is in many forms. Some of these forms are critical, while others might not worth the premiums paid for it. It is a policy used for damage reparation made to owner of the policy and other passengers when the policy owner was not at fault in the accident, there is no one to blame for the accident, the faulty driver in the accident was nowhere to be found, due to a hit-and-run events or other types of situation, driver at fault lacks sufficient means to repair damages made to the policy owner. There are some vital parts of the first-party policy, which are collision, Personal Injury Protection (abbreviated PIP), comprehensive, under insured or uninsured motorist.

Collision and Comprehensive Policy
The collision policy is a guarantee that the car of a policy owner will either be replaced or repair, if an accident occurs, and it does not matter the person who is at fault. The premium are usually based on something deductible.
Comprehensive policy include payment for either a replacement of reparation of a vehicle and properties that belongs to the policy owner, if they have been damaged or lost for different reasons.

Under insured and Uninsured Policy
This is to pay the policy owner and others involved in the event that led to pain and suffering, different lost wages and so on, if the person who is at fault is nowhere to be found, lacks insurance, or has insufficient insurance coverage for the damages.

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