In Texas, each auto insurance policy is required to have a minimum amount of liability coverage. This coverage protects the driver against any claims where the driver is found to be at-fault in a car accident. These claims can be for property damage done to another person’s vehicle or property, as well as medical bills, lost wages, and pain and suffering incurred by the other party. If a claim is made against the insured for damages caused in an accident, liability insurance will provide coverage for those damages and will also provide, and pay for, a legal defense in the event the policy holder is sued because of an accident.
Personal Injury Protection
Personal Injury Protection (PIP) provides coverage for medical bills and lost wages incurred by you regardless of fault. PIP covers you as well as each person in your vehicle. PIP is required to be included in every auto insurance policy issued in Texas, unless it is rejected in writing. PIP must also be available for a minimum amount of $2,500 per person.
Medical Payments Coverage
Medical Payments (Med-Pay) coverage is similar to PIP in that it covers your medical expenses incurred as a result of an accident. Med-Pay will also cover passengers in your car. However, Med-Pay coverage but does not have many of the benefits of PIP. For a more detailed explanation of the difference between PIP and Med-Pay, click here.
Uninsured/Under-Insured Motorist Coverage
Uninsured/Under-Insured Motorist Coverage (UM/UIM) is insurance coverage you purchase to protect you for your damages in the event you are in an car accident with an uninsured vehicle or in a hit and run; or if the insurance policy on the other vehicle is insufficient to fully compensate you for your damages. For instance, if your medical bills are $50,000 and the other driver’s insurance policy is for only $30,000, then you would make a claim for under-insured benefits to pick up the where the other driver’s insurance leaves off.
Collision coverage is purchased to cover your vehicle in the event you are in an accident or collision regardless of fault. In other words, if you are at fault in the accident, then your collision coverage will repair your vehicle or pay its value if it is a total loss. This coverage also comes in handy when you are not at fault and the other driver’s insurance company is stalling on your claim.
Comprehensive coverage provides protection for your vehicle for damages that sustained by your vehicle other than from an accident or collision. Examples would include vandalism, theft, weather damage, or fire.