• Most states require automobile owners to carry liability insurance.girl operates the automobile image by YURY MARYUNIN from Fotolia.com
  
  Most states require automobile owners to carry some type of auto insurance. Check with your state's department on insurance to find the specific requirements for your state. Understanding the different types of coverages available and which coverages are required will help you make a more informed decision when purchasing auto insurance.
  
  

Liability

• Liability auto insurance pays for losses incurred to a third party when you are at fault in an automobile accident. The parts of an auto insurance liability policy are bodily injury, property damage and liability. Bodily injury covers medical costs arising from injuries caused to others. Property damage pays to repair the damage you caused to the property of others in the accident. Liability is the portion of the policy that is required by the state. Different states have different requirements for the amount of liability coverage you must carry.
  
  

Comprehensive

• Comprehensive car insurance coverage covers situations that are not included in liability or collision coverage. Some examples of events that would be covered under the comprehensive portion of the automobile insurance policy are damage caused by storms, windshield replacement, hitting an animal, falling trees, vandalism and theft. You may select different deductibles for comprehensive coverage. A deductible is the amount of money you have to pay out of pocket before the insurance company pays the remainder of the bill.
  
  

Collision

• Collision coverage covers damages caused by an impact with another vehicle or object. The maximum amount you may receive in a collision claim is the actual cash value of the vehicle minus the deductible amount you have chosen. As with comprehensive coverage, you may choose your deductible amount. The higher your deductible amount, the lower your premium.
  
  

Uninsured/Underinsured Motorist

• In some states, you are required to carry uninsured/underinsured motorist coverage. In other states, you may elect to reject this coverage. You will have to sign a form rejecting this coverage or it may be automatically added to your policy. Uninsured motorist coverage pays for damages caused to you or your vehicle by a driver who does not carry insurance. Underinsured motorist coverage will pay if the driver who caused the accident does not carry enough insurance to cover your losses. Uninsured/underinsured coverage may also pay for lost wages if you are unable to work due to your injuries.