Vandalized car

Auto insurance policies will also cover damages that are not caused by an accident. Fire, theft and vandalism are included in what is called Comprehensive insurance. If you purchase your car with an auto loan, your lender will probably require that you carry comprehensive coverage. If the car is totaled, the insurance company will pay its cash value. If your loan balance is more than the car's value at the time of the accident, you are still responsible for paying off the loan. For example, if you owe $4,000 on your car loan, and the cash value of the car is $2,000, the insurance company will give you $2,000. You'll still have $2,000 left to pay on your loan. To protect yourself from having to pay a loan on a car you no longer use, consider Gap insurance. Gap insurance will pay the difference between the cash value of the car and the loan balance. This way, if you total a car that you still owe money on, the gap insurance will ensure that the loan is paid off.

Insurance coverage that pays out without regard for the driver at fault is called No-Fault insurance. Insurance companies will sometimes sue the person at fault to recover their money. One example of this kind of coverage is called MedPay, which covers medical bills for you and your passengers. It will also pay if you or your family members are hit by a car, or otherwise injured while walking down the street. Another example is Personal Injury Protection, or PIP. This is usually an extension of MedPay benefits that includes related factors such as lost wages and childcare. PIP is required by several states.

Car accident / totaled car / insurance

Some states also require their drivers to carry an Uninsured Motorist policy, which provides coverage in the event that you are in an accident with an uninsured driver, or are the victim of a hit-and-run driver. A similar coverage is called Underinsured Motorist coverage. This is useful if the driver who caused the accident doesn't have enough insurance to cover all of your damages. Both Uninsured and Underinsured Motorist policies are designed to protect you from drivers who have little or no insurance.