The world of auto insurance can be difficult to penetrate because of all the unfamiliar words and phrases you may encounter along the way. If you intend to research and buy auto insurance yourself without the help of an expert, you will first need to familiarize yourself with all the different types of insurance available before you make your decision. Read on to learn more about the six major types of insurance that you can purchase to help defend yourself against the high price of road accidents and injuries.

  1. Bodily Injury Liability

Certain types of insurance kick in to cover costs, should you cause an accident in which other people get hurt. Bodily injury liability is one of the most important types of insurance to have because medical bills can quickly become too much for one person alone to bear. Bodily injury covers not only medical bills, but also a legal defense if someone decides to sue you. If you don’t have enough coverage, your personal assets and future earnings could be at risk.

  1. Personal Injury Protection

Whereas bodily injury liability covers the other driver and/or passengers involved in an accident, personal injury protection covers the policy owner’s own medical expenses. Lost wages are also covered in most PIP plans, but check with your insurance company to find out the details because sometimes the amount paid is only a small fraction of your original paycheck.

  1. Property Damage Liability

If you cause an accident that destroys a brand new Ferrari, according to Nigerian law you are responsible for compensating the owner. Without proper insurance, you would have to pay almost 200 million in damages to replace the Ferrari. Property damage liability can offset all or some of the cost of damages to third party vehicles, depending on your level of coverage.

  1. Collision Coverage

Collision coverage helps you replace or repair your car after an accident. If you drive an older car, it may not be worth it to buy collision coverage because the costs of the premium may outweigh the value of the car. On the other hand if your car is brand new, collision coverage can save you from losing a massive amount of money after a wreck.

  1. Uninsured / Underinsured Motorist Coverage

If another driver on the road causes an accident but lacks the necessary insurance coverage to help you recover from the wreck, uninsured motorist coverage kicks in to help foot the bill. It pays for injuries as well as damages to policy holder’s property. In Nigeria over 2 million people get behind the wheel even though they lack even basic types of insurance, so be sure to add uninsured motorist coverage to your insurance plan when it is time to buy.