Shining a Light on Auto Insurance: Questions & Answers

When it comes to protecting your car, you want to make smart choices - but researching and purchasingauto insurance can sometimes be a daunting task if you don't know much about it. To help make understanding auto insurance a little easier, we asked Liberty Mutual representatives what the most frequently asked questions were that they get about auto insurance policies every day - and how they would answer them:

Q: What is a deductible? A: A deductible is the financial responsibility that you have if you are to file a claim. For example, if you were to get in an accident and you were at fault, the damage to your car may cost $2,000. If you selected a $500 deductible, you'd be responsible for paying that amount and the insurance company would pay the difference - the remaining $1,500. Q: What is collision coverage? A: Collision coverage protects you during an event where your car is damaged and you are somehow at fault. For example, if you hit a parking barrier in the parking lot and dented your car bumper, collision coverage would take care of the repair costs, minus your deductible. To learn more about collision coverage, visit Understanding Collision Coverage. Q: What is comprehensive coverage? A: Comprehensive coverage is sometimes known as 'other than collision' - it's comprehensive to damages that fall outside of collision coverage. Common examples of damage covered under comprehensive coverage are fire, theft, vandalism, less your deductible. To learn more about comprehensive coverage, visit Understanding Comprehensive Coverage. Q: What does liability insurance cover? A: If you're at fault for an accident and someone is injured or their property is damaged, liability insurance covers the other person to take care of their costs (for example: medical bills) and helps protect you and your assets by covering those expenses. Many states require a minimum amount of liability insurance in order to register your vehicle, so check your specific state's regulations for proper coverage. Q: Does my driving record affect my premium? A: Your driving record can affect your premium. Insurance companies try to predict what may happen in the future by looking at past behaviors. Your driving record - including speeding tickets, previous accidents - could indicate that you are a higher risk for having an accident, which may contribute to determining your rates. Maintaining safe driving habits is always a good idea. To learn more about auto insurance coverage and benefits, visit our Auto Insurance page.