What is Auto Insurance?
Auto insurance is a contract between you and an insurance company. In exchange for premium (money paid by you to the insurance company) the insurance company helps cover costs from accidents, such as property damage and injuries, as well as your legal defense, if needed.
Your Standard Personal Auto Policy has 3 main sections in NJ:
- Liability is a required coverage that will pay, up to your coverage limits, for property damage and bodily injury caused by you.
- Personal Injury Protection is a required coverage that will pay, up to your policy limit, for injuries to you and/or household relatives, regardless of fault.
- Physical Damage offers optional coverages that will pay, up to the actual cash value of your vehicle if it is damaged, regardless of fault.
Without insurance you could be stuck paying for these things out of your own pocket.