What are the definitions for liability insurance medical payments insurance uninsured motorist comprehensive and collision for auto insurance?
(1) Liability insurance is a kind of third-party coverage. It pays money damages to a third-party who/that sustains damage (that can be measured monetarily) as a result of the insured's negligence (carelessness). The amount payable is limited by the policy limits, which in turn depend upon the amount of coverage that the insured purchased. (2) Medical payments coverage is also third-party coverage. It pays reasonable medical expenses incurred by a third-party, sometimes without regard to fault. Frequently, an insurer will be willing to pay medical expenses in return for avoiding a lawsuit. (3) Uninsured motorist coverage is first-party insurance maintained by the owner of a vehicle. It is intended to pay money damages to the owner, driver and/or passengers who are injured in a collision with a vehicle that does not have liability insurance (which would otherwise pay that/those damages. There is a variant of uninsured motorist coverage called "underinsured motorist coverage". It applies in situations where the at-fault party's liability insurance is insufficient to fully compensate the injured person(s) for his or her injuries. Therefore, the injured party may have a claim against the at-fault party (to the extent of his/her coverage) and their own insurer (for underinsured motorist benefits). Generally, payment takes into account the degree of fault of the insured for causing the collision (because it serves as the functional equivalent of the other party's liability coverage. (4) Comprehensive coverage is first-party insurance that covers categories of physical damage to the insured vehicle that are not caused by a collision. An example would be flooding of a vehicle during a hurricane, or a tree falling on it. (5) Collision coverage is first-party coverage that pays for the repair or pays the actual cash value of the insured vehicle if it is damaged in a collision. Payment is made without regard to fault. The net payment to or on behalf of the insured is reduced by the policy collision deductible. that the insured selected at the inception of the policy. Most states require an insurer to declare a vehicle to be a "total loss" if the cost of repair will exceed a stated percentage of its actual cash value. In that event, the insurer pays the actual cash value less the deductible. In some cases, the insured wishes to retain the salvage (the remains of the totaled vehicle). In those cases, the value of the salvage is also deducted from the payment to the insured.
Liability insurance: The coverage found on any auto policy that handles damage you cause to another person's property, either directly or indirectly with your car. Medical Payments Insurance: Can be either Medpay or PIP. PIP -- or "personal injury protection -- is required in many states, and essentially handles your medical bills in an auto accident, regardless of who is at fault. (summary:will re-attach your fingers if chopped off in a accident) Uninsured Motorist: Can be for either property damage or bodily injury, and essentially makes your carrier step in when the at-fault party is either uninsured or doesn't have enough coverage to handle all your damages. Most people have UMBI (for bodily injury), and mistakenly believe it covers property damage to their cars as well. It doesn't. (summary:will pay for your loss of income as you are an architect whos fingers were cut off and had to miss work for two months while in physical therapy) Comprehensive: A voluntary coverage that, along with collision, constitutes "full coverage" on a vehicle. This is for "non-collision" type accidents, even when you collide with an animal. Essentially, it's to protect your car when you aren't at-fault for a loss. Includes coverage for hail, flooding, etc. Collision: Another voluntary coverage, which handles collisions or overturns involving your vehicle. This is triggered whether you're at-fault or not for a loss, in that it's specific to your vehicle colliding with another object or overturning.