How does auto insurance pay for property damage in the event of a car accident?

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption

UPDATED: Jun 29, 2022

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Written By: Jeffrey JohnsonUPDATED: Jun 29, 2022Fact Checked

There are generally two types of auto insurance coverage: first party coverage and third party coverage. First party coverage insures you and your property (such as medical expenses, damage to your vehicle, the insurance company’s duty to defend you if you are sued as the result of your operation of a vehicle, etc.). Third party coverage pays for other peoples’ injuries or property damage when you are responsible for all or part of an accident. The coverage (and exclusions – things not covered) are set forth in a contract with the insurance company. In exchange for the payment of a premium, the insurance company promises to provide compensation in the event of certain occurrences. There are many coverage options available from insurance companies, and sometimes options that are available from one company are not available from another company. The cost for the same amount of insurance coverage may vary from company to company.

Before purchasing auto insurance, it is a good idea to shop around. Buy the coverage that best suits your needs from the insurance company that offers this coverage at a reasonable price. Positive factors such as customer service, ability to pay claims, a record of paying most claims, general reputation and analyses done by independent organizations should be considered before you make a purchase.

Your vehicle itself can be covered in a couple of ways under an automobile insurance policy. Comprehensive coverage provides coverage for loss to your vehicle due to certain direct causes (such as fire, theft, vandalism, and acts of nature). Collision covers damage to your vehicle in the event that it collides with another vehicle or object, often regardless of who is at fault in the accident. Both comprehensive and collision coverage may be subject to a deductible, that is, damage to the vehicle must exceed the deductible amount before the insurance company must pay you for a covered loss. Deductibles for coverage are available in various amounts, generally the greater the deductible, the lower the premium for the coverage.

If you have suffered injury or property damage due to a car accident, seek the advice of an experienced car accident attorney. It is important to do so right away in order to preserve your rights, because each state limits how long you have to sue through its statute of limitations. An experienced attorney can review your case at no cost to you by filling out Free Advice’s case evaluation form. After completing it, an attorney will contact you to discuss your case, with no further obligation.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Full Bio →

Written by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption