Auto Insurance Coverages Explained

What's in an auto policy?  Like a lot of people, you're probably wondering what things like "bodily injury liability" really mean and what exactly is an "SR22"?  Below is an explanation of the different parts of an auto policy so that you'll know what to look for when you're shopping around for insurance.

Auto Liability Coverage (BI/PD)

Auto liability insurance coverage pays for the damage if you are legally responsible for accidentally injuring someone, or for damaging another vehicle or other property in an auto accident.

Auto liability coverage falls into two categories:

  1. Bodily Injury Liability - which covers medical expenses, pain and suffering, lost wages, and other special damages.
  2. Property Damage Liability -- which covers damaged property, and may include loss of use.

Liability car insurance also pays legal defense and court costs.

Arizona law minimum limit requirements are $25,000 per person, $50,000 maximum for bodily injury and $15,000 for property damage, but higher amounts are available.


Medical Payments

This coverage pays reasonable and necessary medical and funeral expenses for covered persons when those expenses are related to an auto accident.


This auto insurance coverage helps pay for damage to a covered vehicle caused by:

  • Collision with another vehicle
  • Collision with an object
  • A vehicle rollover

A deductible is required.


Comprehensive Insurance

This auto insurance coverage helps pay for loss of or damage to an insured vehicle, not caused by a collision or vehicle rollover.

Examples of this type of damage or loss include:

  • Fire
  • Wind
  • Hail
  • Flood
  • Vandalism
  • Theft
  • Hitting an animal

A deductible may apply.


Uninsured Motorist

This auto insurance coverage pays for injuries to yourself and your passengers when a covered person is injured in an auto accident caused by a driver who does not have Liability Insurance

In Arizona this coverage does not pay for property damage.


Underinsured Motorist

This auto insurance coverage pays for injuries to yourself and your passengers when a covered person is injured in an auto accident caused by another driver who has insufficient Liability Insurance.

In Arizona this coverage does not pay for property damage.


Rental Reimbursement

This coverage pays for renting a car when your auto is disabled due to an auto accident.

Daily allowances or limits vary by auto insurance policy provisions.


Emergency Road Service

This auto insurance coverage pays for having your auto towed due to a breakdown.

Towing limits vary by insurance company.

This information is only a general description of the available types of auto insurance and is not a statement of contract. All auto insurance coverages are subject to all policy provisions and applicable endorsements.


What is an auto insurance deductible?

An auto insurance deductible is the part of a covered loss that you have agreed to pay with your own money.

If you file a claim against your insurance, you will pay only the amount of the deductible. your insurance company will pay the rest - up to your coverage limit.

When choosing a deductible, you must decide how much you would be willing and able to pay out-of-pocket, if you ever had to file a claim.

Typically, higher deductibles mean lower auto insurance policy premiums.


What is an SR22?

SR22 is essentially a proof of financial responsibility and is required after many DUI arrests and license suspensions.  When you get an SR22 in Arizona, the insurance company must notify the MVD upon cancellation of insurance.  This is effectively an extra measure to insure that a driver who the Department deems to be of a higher risk maintains consistent insurance.  For ordinary insurance, the insurance company would simply notify the MVD in the regular course of business, instead of making a special effort as in the SR22.

The average cost of the SR22 is $20 for a six-month term.  An SR22 is an endorsement to the insurance policy and can not be purchased separatly.


What is a Non-Owners Policy?

A non-owners insurance policy is a type of auto policy that will cover you for liability only, in any vehicle that you do not own or have regular access to.


Not sure which coverages to select?  Click here for our coverage selection tool.   Decide in a few easy steps what coverage might work best for you.


If you have questions regarding this or any other insurance matter, please feel free to contact us to speak with an insurance professional.