Auto Insurance Terms: What do they really mean?

Question

Can anyone help me make sense of this? Here are the key terms I'm looking to make sense of. Would these be decent for auto insurance coverage?

Bodily Injury Liability: $50,000/$100,000
Property Damage Liability: $25,000
Underinsured Motorist: $50,000/$100,000
Underinsured Motorist Property Damage: $25,000

Also...Why does my premium go up when the above prices are reduced to $25,000/$50,000 for Bodily Injury Liability/Underinsured Motorist & $10,000 for Property Damage Liability/Underinsured Motorist Property Damage?

Any other tips for good car insurance?

Answer 1

Since nobody else answered your question, I will



Q. Bodily Injury Liability: $50,000/$100,000

A. This means your policy would pay up to $50K for any one injured person. The most the policy will pay is $100K per Occurance.



So lets say you are in a horrible car accident and 1 person has medical bills for over $400K(Remember just an example) the most your policy would pay for that one person is $50K. If there were 3 people injured the most the policy would pay(combined for all people) is $100K



Q. Property Damage Liability: $25,000

A. Your policy will pay up to $25000 for damages you cause to someone elses propert.



Q.Underinsured Motorist: $50,000/$100,000

A. If YOU/Your Passengers are injured in an accident and the at fault person does NOT have enough coverage on their policy, you policy will pay for YOUR/Your Passengers remaning medical bills.



They will pay up to $50 K per person and $100K per accident (just like the BI)



Q.Underinsured Motorist Property Damage: $25,000

A. If YOU are in an accident and the at fault person does not have enough coverage on their property damage policy, your insurance company will pay the remainder up to $25K.



Example, you own a lexus and its worth $15K (Example only). Its totalled. The other person only carries $10K in Property Damage Liability. His insurance pays you the limit of $10K and then your insurance will pay the extra $5K.



Get it? I hope so.



Its always better for yourself to carry more than the state minimum requires. That way you cannot be sued and someone take away your home and whatever else you own bc you wanted to pay for cheap insurance.

Answer 2

The liability coverage pays when you cause an accident. The amounts you list would cover $50k per person for injuries to the other party, with a limit of $100k total (like if there is more than one person hurt). Property damage liability would pay to repair the other person's vehicle or other property that is damaged.



Underinsured Motorist coverage pays for your injuries or damage if someone hits you and doesn't have enough insurance to cover all of it. The limits are the same as in the liability coverage.



The amounts look ok - I usually recommend $100/300/50 for liability. People are really sue happy and -at least in my part of town - they drive a lot of vehicles that are worth more than $25k. I don't know why the premium would go up when you lower the coverage amounts. It would usually go down.

Answer 3

They mean pretty much exactly what they say. You bodily injury if for injuries, property damage is damage to property cause by the accident and so on. The only thing that cought my eye though is you say that your premiums go UP with less coverage? I have never heard of that before. The less coverage you have the LOWER your premium should be but you need to use some common sense about how low of coverage you want. If you get in an accident and the damages are more than you coverages you are gonna be eating hot dogs and mac and cheese for the rest of your life because you will get sued for anything past what the insurance covers.