Guide to Common Auto Insurance Coverages

Most U.S. states require bodily injury and property damage liability auto insurance. Add-ons include PIP, uninsured motorist, and comprehensive coverage.

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Maya Afilalo holds over 10 years of professional experience in writing, communications, and research, which she leverages to provide accurate and reliable information to empower consumers. In addition to overseeing content production, Maya has herself written many articles on auto insurance costs, company comparisons, state laws and requirements, and other topics. She is committed to helping consumers navigate the complex world of car insurance with clarity and confidence. Maya holds a bachelor’s degree from the University of Pennsylvania and a master’s from North Carolina State University.

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Last updated: June 15, 2026

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Virtually all states in the U.S. require some form of car insurance to drive legally. However, these requirements can vary significantly by state, and it’s usually best to get more coverage than the legal minimum, which may not be enough to protect you financially in a moderate accident.

Below, we’ve compiled a guide to the basics of auto coverages, breaking down these often confusing concepts in simple language so they’re easy to understand.

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Types of Auto Insurance Coverage

Nearly every state requires bodily injury and property damage liability, which are together known as “liability coverage.” Some states also require other coverages like uninsured/underinsured motorist coverage, medical payments, or personal injury protection. Generally, the more coverage you get, the higher your premiums will be.

Coverage requirements vary significantly by state. For example, while New York requires liability, PIP, and UI/UIM coverages, Florida only mandates property damage liability and PIP, with bodily injury liability being optional.

FYI:

Liability coverage does not include a deductible, but collision and comprehensive coverages do. Of the other add-on coverages we list below, most don’t require deductibles, but there are exceptions (such as glass deductible buyback).

Coverages Required in Most States

Most states will require you to purchase both liability coverage types below at varying limits.

The exceptions are Florida (no bodily injury liability required), New Jersey (no bodily injury liability required with a basic policy), and New Hampshire (the only state without any minimum auto insurance requirements, though you must prove financial responsibility in the event of an accident).

Property damages liability: Pays for damages you caused to another vehicle or property with your car.
Bodily injury liability: Covers expenses related to injuries or deaths for the other party from an accident you caused.

Coverages Required in Some States

Some states require one or more of the following coverages on top of basic liability insurance.

Medical payments (MedPay): Covers medical bills for you and your passengers in an accident, regardless of who was at fault. Very few states require MedPay; more states require personal injury protection instead (see below).
Personal injury protection (PIP): Functions like medical payments in that it covers medical expenses from an accident, but also pays for lost wages, childcare, and more. PIP is mandatory in no-fault states.
Uninsured/underinsured motorist coverage (UI/UIM): Reimburses after a collision with an uninsured or underinsured motorist, or if you’re hit in a hit-and-run (even as a pedestrian).

DID YOU KNOW?

Less than half of the states in the U.S. — 20 out of 50, plus D.C. — require uninsured/underinsured motorist coverage.¹

Coverages Optional in All States

Illustration showing a blue car surrounded by icons for optional auto insurance coverages.

Supplemental coverages such as collision and glass repair provide extra financial protection for your vehicle.

These are the most common supplemental coverages offered by major insurers. It’s often wise to add comprehensive and collision coverages, which are known as full coverage when grouped with liability coverage with increased limits.

Note that while collision and comprehensive are optional under state laws, they are required by financial institutions if you loan or lease your car.

Some insurers, like Travelers and Progressive, offer a wide catalog of these specialized add-ons. Others have a more limited selection.

Accidental death and dismemberment (AD&D): Applies if you sustain a permanent impairment in an accident, like losing a limb or your eyesight.
Comprehensive: Includes theft and damage reimbursement from events other than collisions, like fires, floods, falling rocks, and more.
Collision: Covers damage to your vehicle or another object when you’re at fault for the collision (normal wear and tear excluded).
Custom equipment coverage: Replaces any stolen or damaged aftermarket equipment in your car.
Gap coverage: Reimburses you for the difference between what you paid for your car and what it’s currently worth if your car is stolen or totaled. May be required by your lender.
Glass deductible buyback: Pays for damage to windshields, side and rear windows, and sunroofs.
Rental reimbursement: Reimburses you for rental costs if your car is being repaired under a covered claim.
Rideshare coverage: Covers you if you drive for Uber or Lyft (standard policies don’t cover driving for commercial reasons).
Emergency road service: Provides roadside assistance if your car breaks down, including towing, lockout services, or battery jumps.
Mechanical breakdown insurance (MBI): Covers repairs for mechanical and electrical failures for relatively new cars with low mileage.
New car replacement: Replaces your new car with another if it’s totaled or stolen. This coverage is usually restricted to new vehicle owners.
Optional basic economic loss (OBEL): Adds $25,000 to $50,000 worth of coverage to your policy, which you can spend how you like (e.g. income loss or physical therapy).
Transportation/travel expense coverage: Covers meals, lodging, and transportation costs if your car is damaged during a road trip.

How Can You Save on Auto Insurance?

You can get a discount on your policy in a few ways:

Adjust your deductible. Raising your deductible will mean lower premiums. If you get into an accident, you’ll have to pay more before your auto insurance will kick in, so there is a trade-off there. Depending on your personal finances, $1,000 often strikes a good balance.
Take a safe driving course. Many auto insurance providers offer discounts if you take a safe driving course. That’s especially true for teen drivers, who are notoriously more expensive to insure, as they are more likely to get into car accidents.
Bundle your auto insurance. You can save money by bundling your auto insurance with homeowners insurance, renters insurance, and other types of policies. Most national providers, like GEICO, offer multiple services aside from auto insurance.
Drop coverage: Again, dropping coverage is a trade-off. For example, if you drop rental reimbursements coverage to save money on premiums and then need to rent a car because of covered damages, you’ll have to pay out of pocket. For older cars, you might want to drop collision or coverage insurance.

TIP:

To estimate your premium, use our auto insurance calculator.

Recap

Many types of auto insurance coverages exist, but only liability coverage is required for drivers in most states. A number of states also require supplemental coverages like personal injury protection and uninsured/underinsured motorist coverage on top of liability coverage.

Though not required, we recommend getting full coverage if you can, which means adding comprehensive and collision coverages to your policy and raising your liability limits. Learn about other add-on specialized coverages, like gap coverage or rental reimbursement, to craft a policy that meets your needs.

Frequently Asked Questions

What does auto insurance cover?

Auto insurance covers the costs related to liabilities like injury and property damage stemming from accidents, theft, vehicle breakdown, and other liabilities. Liability coverage is the type most commonly required by law and financially covers any damages stemming from injuries sustained by other people in an accident you’re at fault for.

What car insurance coverage is required by law?

In almost all states, some combination of bodily injury liability and property damage liability are required for drivers. Some states have more comprehensive coverage requirements that also mandate purchase of one or more of the following: personal injury protection (PIP), medical payments (MedPay), and uninsured/underinsured motorist coverage (UI/UIM).

New Hampshire is the only state that doesn’t have any minimum insurance requirements. However, if you opt to be uninsured, you must prove you can pay for expenses stemming from an accident under the state’s financial responsibility law.

How much does auto insurance coverage cost?

The national average is $2,356 annually for full coverage and $722 per year for minimum coverage. However, rates can vary significantly across states due to provider availability, population density, and more. If you want to learn more, hit the search tab at the top of this page and search for our pricing guide for your particular state.

What are the different types of car insurance coverage?

The main types of car insurance coverage include: liability (bodily injury and property damage), collision, comprehensive, personal injury protection (PIP), uninsured/underinsured motorist (UM/UIM), gap insurance, rental car reimbursement, and rideshare coverage. Each type serves a different purpose and has its own cost and benefit profile.

What is the difference between liability and full coverage car insurance?

Liability coverage is composed of bodily injury liability and property damage liability coverages, and it pays for damages caused in an accident you’re liable for. Bodily injury liability covers the costs of medical expenses, lost wages, and legal fees for the other party, while property damage liability covers damage to the other vehicle or physical objects.

Full coverage is simply liability coverage grouped with two add-ons: comprehensive and collision coverage. While collision coverage pays for damage to your car regardless of fault, comprehensive pays for damage to your car from incidents like theft, vandalism, inclement weather, or falling rocks.

How do I choose the right car insurance coverage for my situation?

We recommend getting three quotes from different providers in order to gauge who offers you the best value. Besides that, look into the coverage types providers offer; some will offer more specialized add-ons than others. If you’re in the military, you might want to go with a military-centric provider like USAA as rates tend to be cheaper and policies are tailored to military members.

What is the most important type of car insurance coverage to have?

You should always have the minimum required insurance under your state law so you’re road-legal and aren’t cited for driving uninsured.

Besides that, we recommend full coverage at limits of $100,000 for bodily injury per person, $300,000 for bodily injury per accident, and $100,000 for property damage.

What is the difference between comprehensive and collision car insurance?

Collision coverage pays for damage to your vehicle resulting from accidents with other cars or objects. Comprehensive coverage pays for non-collision damage including theft, vandalism, fire, weather events such as hail and floods, falling objects, and collisions with animals.