Which Auto Insurance Coverage Pays YOUR Bills?

The first item listed on every auto insurance policy is BI/PD. Your agent probably told you that means Bodily Injury/ Property Damage -- that you are responsible for to the other guy. So, of all those fancy sounding things on your insurance policy, what pays YOUR bills if you are injured?

There seem to be ten or fifteen different kinds of auto insurance all wrapped up in your policy, but what you want to know is this: If you are hurt, which of those will pay YOUR expenses? You don't want most of your auto insurance dollar going to a complete stranger!

Auto insurance is not simple. Trying to read even the 'readable' policies, which most states require insurance companies to issue can be challenging. It seems like the vast majority of the premium goes to protect the other driver. Where does coverage for the insured driver and their family come in?

Personal Injury Protection
If you are in an accident and it is ruled your 'fault', then YOUR auto insurance company is going to pay some, if not all, of your medical expenses. For instance, PIP, Personal Injury Protection, not only pays medical bills, but also pays for 'loss of services', such as additional child care, housekeeping, sending out for food, and other reasonable expenses related to your injury- BUT only up to the dollar limits you set. In many states, those auto insurance limits start at $2500.

If that is the limit you have selected, and if the emergency room charges the way they usually do, that may well be gone before you walk out the door. Ask your agent for a quote on higher limits.

Uninsured/Underinsured Motorists
What other auto insurance coverage do you have? If an accident is NOT your fault, you can call upon your Uninsured/Underinsured Motorist coverage. It covers YOU if the other guy has no, or not enough, auto insurance.

Medical Payments
In some states, Medical Payments takes the place of PIP, and ONLY pays medical bills. Then you're on your own for the added expenses. Enter the duck. AFLAC now offers an additional coverage for auto accidents which pays an agreed-upon sum directly to YOU in case of an auto accident. Money in YOUR pocket to do anything you want with. Of course it costs; you can't say the words 'auto insurance' without shriveling up your wallet.  But it beats the alternative!

Some states offer BOTH med payments and PIP. You are not choosing this option. It is usually cheaper to just raise the limit you carry on PIP. Auto insurance companies charge less per dollar of insurance the more you buy. So, generally, having a higher limit on one coverage will cost less than having two types of auto insurance. Don't take my word for it. Check it out!

Although it may seem that most of your auto insurance premium is going to cover the 'other guy', remember that one of the main items you are covering with insurance is you and your family. Second in line is your car. Then comes coverage for the other guy - which is just another way of saying that you are keeping your assets from being taken away from you BY the other guy. So, all in all, virtually every dollar spent protects YOU!