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Why You Can Trust the MarketWatch Guides Team
Here’s a breakdown of how we reviewed and rated the top auto insurance providers
130
Providers ReviewedOur team looked at over 100 of the top auto insurance providers in the U.S., from national providers like USAA, Travelers and State Farm to regional providers like Erie Insurance.
8,500
Data Points AnalyzedTo properly score each auto insurance provider, we looked at cost data, claims processes, customer review scores, industry standing, available discounts, coverages and add-ons.
800
Research HoursOur team put in the time so you don’t have to, evaluating cost data, reading customer reviews and researching companies to determine the most reliable options for coverage.
8,500
Customers SurveyedWe asked thousands of customers to describe their experience with their auto insurance provider to understand how real customers feel about their insurers.
Learn more about our methodology and editorial guidelines.
Most Common Car Insurance Coverage
The six most common types of car insurance coverage are:
- Liability insurance
- Collision coverage
- Comprehensive insurance
- Uninsured motorist coverage
- Medical payments coverage (MedPay)
- Personal injury protection (PIP)
Some of these coverages may be mandatory in your state while others are only optional. Even if a type of car insurance is not required in your state, it may still be available to purchase from your insurer. If you decide to go with full-coverage auto insurance policies, keep in mind that they are a combination of types of coverage that will keep you protected in more situations.
Below we’ll cover how much insurance you need as well asprovide further information on the types of car insurance you can purchase.
Liability Coverage
Liability car insurance is used to pay for other people’s medical bills and property damage if you cause a car accident. This type of car insurance is required in every state except for New Hampshire and Virginia, although each location sets its own liability limits for minimum coverage. Read more about liability coverage vs full coverage in our guide, highlighting the differences between each type.
Types of Insurance Liability
There are two main components of liability coverage: bodily injury liability insurance and property damage liability insurance.
- Bodily injury (BI) liability insurance: This pays for other drivers’ injuries in your at-fault accident, but it doesn’t pay for your injuries.
- Property damage (PD) liability insurance: This covers damage to other people’s vehicles or property when you’re at fault for an accident.
The main point to keep in mind with liability insurance is that it won’t cover your damages or injuries if you cause an accident. If someone else is found to be at fault for an accident, either that person’s liability coverage or your PIP will cover damages.
Who Should Carry Liability Car Insurance?
Nearly everyone should have liability insurance, as it’s required in nearly every state. Only drivers in New Hampshire and Virginia can opt out of liability coverage, yet that’s never recommended.
Whether they drive new cars or older vehicles, all motorists should carry liability insurance to legally drive and avoid paying for expensive repairs to other vehicles out of pocket.
Collision Coverage
Collision insurance covers the repairs to or replacement of your vehicle after an accident. It also takes care of your car after a hit-and-run or if you crash into a tree or a fence. Don’t expect collision coverage to apply to damages from non-crash incidents or medical bills, though.
No state requires that drivers carry collision insurance. The key difference between this optional coverage and the mandatory liability insurance is that collision insurance applies to your car rather than other impacted vehicles.
Who Should Carry Collision Coverage?
It’s smart for all drivers who can afford collision coverage to carry this type of car insurance. Repair costs are often expensive after car accidents, and collision insurance makes it possible for many drivers to meet the expense of fixing their vehicles.
Only drivers who can’t afford more than minimum coverage should consider avoiding collision coverage. Keep in mind that this coverage type is required for most drivers with a car loan or lease.
Comprehensive Car Insurance
The value of comprehensive coverage will become clear if your vehicle is damaged by something other than a collision. Read more about comprehensive vs collision coverage in our guide. Common examples of situations where comprehensive insurance applies include damages caused by the following:
- Theft
- Vandalism
- Falling objects
- Hail
- Natural disasters
Comprehensive insurance is optional in every state, although lenders and leasing agencies typically require this coverage. Exclusions with this type of car insurance include vehicle repairs and medical bills after a collision.
Who Should Carry Comprehensive Insurance?
Those who wouldn’t be able to pay for unexpected damage to their vehicles often select comprehensive coverage as an affordable up-front cost. It can be expensive to repair windshields, dents and other issues that would be considered covered losses with comprehensive coverage.
Unless you’re unable to afford anything beyond minimum liability car insurance, we recommend that you strongly consider comprehensive coverage.
Uninsured Motorist Coverage
Uninsured and underinsured motorist coverage will pay for medical bills and repairs to your vehicle if you’re hit by someone driving without car insurance. It’s illegal to drive without auto insurance in most states, but a study from the Insurance Research Council found that in 2019, 12.6% of American drivers didn’t have car coverage.
Twenty-one states and the District of Columbia require drivers to carry uninsured motorist coverage, while 13 states mandate underinsured motorist coverage. The table below lists the locations that require these types of car insurance.
| State | Required UM Coverage Limits | Additional Notes |
| Connecticut | • $25,000 per person | Underinsured motorist coverage required |
| District of Columbia | • $25,000 per person | |
| Illinois | • $25,000 per person | |
| Kansas | • $25,000 per person | Underinsured motorist coverage required |
| Maine | • $50,000 per person | Underinsured motorist coverage required |
| Maryland | • $30,000 per person | Underinsured motorist coverage required |
| Massachusetts | • $20,000 per person | |
| Minnesota | • $25,000 per person | Underinsured motorist coverage required |
| Missouri | • $25,000 per person | |
| Nebraska | • $25,000 per person | Underinsured motorist coverage required |
| New Hampshire | • $25,000 per person | Underinsured motorist coverage required Drivers who reject car insurance are exempt |
| New York | • $25,000 per person | |
| North Carolina | • $30,000 per person | Underinsured motorist coverage required |
| North Dakota | • $25,000 per person | Underinsured motorist coverage required |
| Oregon | • $25,000 per person | |
| Rhode Island | • $25,000 per person | Drivers can decline Uninsured/uninsured |
| South Carolina | • $25,000 per person | |
| South Dakota | • $25,000 per person | Underinsured motorist coverage required |
| Vermont | • $50,000 per person | Underinsured motorist coverage required |
| Virginia | • $30,000 per person | Underinsured motorist coverage required Drivers who reject car insurance are exempt |
| West Virginia | • $25,000 per person | |
| Wisconsin | • $25,000 per person |
Who Should Carry Uninsured Motorist Coverage?
Drivers are required to carry uninsured motorist coverage in the states listed above, but even those living in other states may want to purchase this type of car insurance. It’s a smart choice for those who wouldn’t be able to pay for damages if they got hit by an underinsured or uninsured driver.
MedPay and PIP could cover your medical expenses in this situation, while collision insurance may take care of your car repairs. Drivers who opt out of those coverages may want to get uninsured motorist coverage in their place.
Medical Payments Coverage
Medical payments coverage, often known as MedPay, covers certain medical expenses, funeral costs and health insurance deductibles for motorists who end up in car accidents. You and your passengers will receive protection through MedPay regardless of which driver caused the collision.
MedPay coverage is optional in most states. However, it’s mandatory in three states and has the following minimum coverage limits:
- Maine: $2,000 per person
- New Hampshire: $1,000 per person for those who purchase car insurance
- Pennsylvania: $5,000 per person; can be replaced with PIP
Be aware that MedPay and PIP cannot be purchased on the same auto insurance policy. Since these types of car insurance coverage have many similarities, you’ll need to pick just one.
Who Should Carry Medical Payments Coverage?
Those in Maine and New Hampshire must buy medical payments coverage, while Pennsylvania drivers should consider it as well. For other motorists, MedPay offers a cost-effective method for covering significant medical expenses.
Drivers don’t need to consider MedPay if they already carry PIP. These types of auto insurance coverage are similar and overlap in various ways.
Personal Injury Protection (PIP)
Personal injury protection (PIP) takes care of certain medical bills, funeral costs and child care services after car accidents. This type of car insurance is required in no-fault states or places where each driver’s damages are covered by their own insurer regardless of who caused an accident.
Drivers in 12 states must carry PIP insurance, while Pennsylvania drivers have to choose between this and MedPay. Details on state car insurance policy limits are listed below:
| State | Required PIP | Additional Notes |
| Delaware | • $15,000 per person | At-fault car insurance state |
| Florida | • $10,000 per person | Doesn’t require bodily injury liability insurance |
| Hawaii | • $10,000 per person | |
| Kansas | • $4,500 per person in medical expenses | |
| Massachusetts | • $8,000 per person | |
| Michigan | • $250,000 per person | Maximum limit offers unlimited coverage |
| Minnesota | • $20,000 per person in medical expenses | |
| New Jersey | • $15,000 per person | |
| New York | • $50,000 per person | |
| North Dakota | • $30,000 per person | |
| Oregon | • $15,000 per person | At-fault car insurance state |
| Pennsylvania | • $5,000 per person | Can be replaced with $5,000 per person in medical payments coverage |
| Utah | • $3,000 per person |
Who Should Carry Personal Injury Protection?
Residents of the locations listed above are required by state law to carry PIP insurance, but others may want to consider this type of car insurance as well. PIP is relatively similar to MedPay, but it comes with more extensive coverage offerings.
PIP insurance is typically inexpensive, and the medical bills from one car accident will likely make up the cost of coverage. Drivers who feel comfortable taking care of unexpected medical costs on their own may be able to look past PIP, though. Since PIP isn’t available everywhere, some drivers may want to consider MedPay instead.
Other Car Insurance Coverage
Other auto insurance coverages are available, though they’re less common than those listed above. A few additional coverage options include:
- Roadside assistance: This provides drivers with towing coverage, flat-tire assistance, battery jump-starts and help after vehicle lockouts. Read more in our guide of the best roadside assistance plans.
- Rental car reimbursem*nt: A driver is offered a rental car after their vehicle gets damaged in a wreck and needs to be repaired or replaced.
- Gap insurance: Gap coverage pays for the difference between your vehicle’s actual cash value after an accident and the amount of money left on your car’s loan or lease.
- Total loss protection: It provides a specified amount of money for your car’s replacement if it’s deemed a “total loss” due to a collision with an at-fault driver.
- Commercial vehicle insurance: If you drive a commercial vehicle, this will cover you in case you’re in an accident while driving for work. You can also get commercial vehicle insurance for a food truck.
- Mechanical breakdown insurance (MBI): Covers repairs and replacements for parts in your vehicle that are not caused by an accident.
- Rideshare insurance: Similar to commercial vehicle insurance, if you use your personal vehicle for ridesharing or food delivery, this will keep you covered while you’re on the job.
- Usage-based auto insurance: Usage-based telematics programs use technology to track how much you drive in order to assign you a price for your car insurance.
While some other types of car insurance can be found, the ones above are some of the most valuable options for motorists who’d like more coverage.
Auto Insurance Policy: The Bottom Line
In this article, we explained the common types of car insurance offered by providers. The minimum car insurance coverage you’re required to purchase is based on the state you live in. Most states only require liability coverage at a minimum, so it can be worth exploring other options as you shop for car insurance.
Car Insurance Recommendations
Multiple companies offer cheap car insurance with exceptional protection, and some standout coverage options include Geico, State Farm and USAA. It’s worth comparing car insurance quotes from providers before picking an auto insurer, and the options below each represent a great place to start.
Geico: Best for Budget-Conscious Drivers
Overview
It’s difficult for motorists to look past Geico. Its accessibility comes from all the major types of car insurance it offers at affordable rates. On top of that, drivers can find reassurance in the company’s ability to pay out claims due to its A++ financial strength rating from AM Best.
Geico scored above average in the J.D. Power 2022 U.S. Auto Insurance Study℠ across most regions and performed similarly in the J.D. Power 2022 U.S. Auto Claims Satisfaction Study℠.
Keep reading: Geico insurance review
State Farm: Best Customer Experience
Overview
There’s good reason for drivers to select coverage from State Farm, as the company is known for its high service standards. One of the provider’s major upsides is its wide range of local insurance agents, who often make State Farm feel like a smaller company than it is.
Drivers can purchase all major types of car insurance through State Farm, and the company has an A++ financial strength rating from AM Best. The provider also scored above average for almost every region in the J.D. Power Auto Insurance Study, showing its emphasis on serving drivers.
Keep reading: State Farm insurance review
USAA: Best for Military Members
Overview
Those who are in the military, veterans or related to military members should strongly consider coverage from USAA. It’s clear that drivers enjoy working with USAA, as the provider earned the highest score in nearly every region of the J.D. Power Auto Insurance Study.
Rates are typically low with USAA, making it an even more appealing option. USAA has strict eligibility requirements, so not all drivers will be able to purchase car insurance from this provider.
Keep reading: USAA insurance review
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Types of Car Insurance: FAQ
Below are frequently asked questions about the different types of car insurance.
The three key types of car insurance are liability insurance, collision coverage and comprehensive insurance. Liability insurance covers damages caused to other people, while collision and comprehensive coverage take care of repairs that must be done for your car.
Basic car insurance is known as liability insurance, and it has two main parts. Bodily injury liability insurance covers medical bills for other drivers in an accident where you’re at fault, while property damage liability insurance takes care of damage to their vehicle.
The most basic car insurance policy is minimum coverage car insurance. The amount of insurance it takes to meet your state minimum varies, so you’ll need to factor in laws specific to your location.
The five basic types of car insurance are liability insurance, collision coverage, comprehensive insurance, uninsured motorist coverage and either medical payments coverage or personal injury protection.
Our Methodology
Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.
Here are the factors our ratings take into account:
- Cost: Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities were both taken into consideration.
- Coverage: Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
- Reputation and experience: Our research team considered market share, ratings from industry experts and years in business when giving this score.
- Availability: Auto insurance companies with greater state availability and few eligibility requirements scored highest in this category.
- Customer experience: This score is based on volume of complaints reported by the NAIC and customer satisfaction ratings reported by J.D. Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.
Our credentials:
- 800 hours researched
- 45 companies reviewed
- 8,500+ consumers surveyed
*Data accurate at time of publication.
If you have feedback or questions about this article, please email the MarketWatch Guides team ateditors@marketwatchguides.com.
