How Auto Insurance Works: Breaking Down Core Coverages and Industry Terminology 

Navigating auto insurance can feel like learning a second language. Between the legal requirements and the various coverage levels available, it is easy to feel overwhelmed by the fine print. At A-Able Auto Insurance Agency, we’re ready to help you understand the core components of your policy and make sure that you have a financial safety net tailored to your needs.

Understanding Texas Liability Requirements

Texas requires drivers to carry at least 30/60/25 liability coverage for third-party bodily injury or property damage. This means that your policy must include at least $30,000 of bodily injury liability coverage per person and $60,000 per accident, as well as $25,000 in property damage liability coverage. You must carry a physical or digital copy of your insurance card and present it when asked by law enforcement.

What Do Collision and Comprehensive Coverage Do?

Collision coverage can cover damage to your vehicle resulting from an accident with another car or object, regardless of fault. Comprehensive coverage can help with damage caused by theft, vandalism, fire and weather events.

Common Insurance Terminology

A few terms worth knowing include:

• Deductible: This is the amount you pay before your insurer covers the rest of a claim.
• Premium: This is your regular (e.g., monthly) payment to keep the policy active.
• Limits: These are the maximum amounts that your policy will pay out for covered losses.
• Declarations page: This is the summary of your personal information, coverage, limits and deductibles.
• Uninsured/underinsured motorist coverage: This can cover your losses if you’re hit by an at-fault driver with little or no liability coverage.

How We Can Help

Contact A-Able Auto Insurance Agency to review your current coverage, compare options across multiple carriers and make sure your policy reflects your budget and driving habits. We serve drivers throughout Dallas, TX and welcome any questions you have about your auto policy.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.