Car Insurance 101

The six coverages a car policy is built from

A car insurance policy is not one thing. It is a stack of separate coverages, each with its own limit, its own deductible and its own reason to exist.

1. Liability

Pays other people when a crash is your fault — their injuries under bodily injury liability, their property under property damage liability. Required in both Texas and New Mexico.

It pays nothing towards your own car and nothing towards your own injuries. That is what the rest of the stack is for.

2. Collision

Pays to repair or replace your car when it hits something, or something hits it — another vehicle, a pole, a curb, the ground. Fault does not matter; the deductible applies either way.

Optional by law, required by every lender and lessor.

3. Comprehensive

Pays for damage that is not a collision: hail, theft, fire, flood, vandalism, a cracked windshield, an animal in the road. Its own deductible, separate from collision.

In hail country this is the coverage that earns its premium.

4. Uninsured and underinsured motorist

Pays when the at-fault driver has no insurance, or not enough of it. Both states require carriers to offer it and require your rejection in writing.

It is the coverage that fills the hole the other driver left, which is why dropping it to save a little is the trade most likely to be regretted.

5. Medical payments (MedPay)

Pays medical bills for you and your passengers after an accident, whoever caused it, with no deductible. It sits in front of your health insurance and covers the deductibles and copays that follow a crash.

6. Personal injury protection (PIP)

Broader than MedPay: medical bills plus a share of lost wages and the cost of services you can no longer perform. In Texas it must be offered and rejected in writing.

A vehicle carries MedPay or PIP, not both.

The add-ons that are not coverages exactly

What to take away
  • Liability pays other people; collision and comprehensive pay for your car.
  • Collision and comprehensive carry separate deductibles.
  • Uninsured motorist is the one that fills the other driver’s hole.
  • A vehicle carries MedPay or PIP, never both.

Common questions

Which of these are required?

Liability in both states. Everything else is optional by law, though a lender will require collision and comprehensive while there is a loan.

Do I pay two deductibles if both apply?

Only one per claim — whichever coverage is paying. A hail claim is comprehensive; hitting a pole is collision.

Is glass separate?

Usually it falls under comprehensive, sometimes with its own lower deductible or none at all. It varies by carrier and it is worth asking.

Still want it checked by a person?

Start online and an agent picks it up, or call and we will do the whole thing with you. In English or Spanish, whichever the conversation starts in.

Get my free quote →Call 915-503-1207

More from Car Insurance 101

How to Compare QuotesWhat actually makes two quotes comparable, and the four places a cheaper one is usually cheaper. How Your Rate Is CalculatedWhat a rating engine is actually weighing, and which of those things you can still do something about. How Much Coverage You NeedWhy the state minimum is a floor rather than a recommendation, and how to pick limits you can defend. Car Insurance DiscountsThe sixteen we ask about on every quote, why an online form only finds some of them, and when to ask again. How to Save on Car InsuranceThe levers that actually move the number, in order, and the two that look like savings and are not. Liability CoverageThe coverage the law requires, what the three numbers mean, and what happens when they run out.