1. Auto Insurance

2. A. What is auto insurance?
Protection against financial loss if you have an accident involving a vehicle
Legally liable – to be at fault for an accident
If you don’t carry insurance to cover accidents that you cause – people can and will sue you for personal belongings & assets

3. B. Six Types of Coverages
Bodily injury liability
Property damage liability
Medical payments (also called Personal Injury Protection or PIP)
Collision
Comprehensive
Uninsured/underinsured motorist coverage

4. 1. Bodily injury liability
Covers medical injuries that you cause to someone else
Does not cover your medical injuries

5. 2. Property damage liability
Covers damages that you cause to someone’s personal property
Includes other vehicles, lamp posts, telephone poles, fences, landscaping, buildings, etc.
Does not cover your vehicle’s damages

6. 3. Medical payments (Personal Injury Protection or PIP)
Covers treatment of medical injuries to you, the driver and passengers of the car (regardless of who is at fault)
Medical payments
Lost wages
Funeral costs
If in an accident with someone & it is their fault – their bodily injury liability should cover your medical injuries before your PIP kicks in
Covers as pedestrian if struck by a car on a public road

7. 4. Collision Covers damages to your car resulting from:
a collision with another car or object (except animals)
flipping over
potholes
Usually contains a deductible which is per accident
Your fault – insurance will pay minus your deductible
Someone else’s fault – their property damage liability should cover your vehicle’s damages

8. 5. Comprehensive Covers loss to your vehicle due to theft
Covers damages to your vehicle caused by other than a collision, such as:
Hail, fire, earthquake, explosion, contact with animals, windstorm, vandalism, etc.
Usually contains a deductible which is per accident
May also cover when windshield is cracked or shattered

9. 6. Uninsured/Underinsured
Uninsured: covers your medical injuries when you (or a member of family or driver with permission) if hit by an uninsured or hit-and-run driver (not your fault)
Underinsured: covers your medical injuries when at-fault driver does not have enough insurance to pay for losses; also covers you when you are hit as a pedestrian
Only covers medical injuries not damages to vehicle

10. Full coverage (all 6 types)
Bodily injury liability
Property damage liability
Medical payments or PIP
Collision
Comprehensive
Uninsured/underinsured

11. Liability coverage
Bodily injury liability
Property damage liability

12. C. Can you legally drive without insurance in the state of Iowa?
NO! Most states require drivers to have minimal amounts of liability insurance
When you purchase a car with a bank loan – most will require you to have full coverage

13. Liability insurance: expressed as three numbers in thousands
Iowa’s minimum - 20/40/15
1st number: bodily coverage of 1 person per accident
2nd number: bodily coverage of more than 1 person per accident
3rd number: property damage of accident per accident