# Car insurance coverage types explained

> Car insurance coverage types explained: what liability, collision, comprehensive, PIP, MedPay, UM, gap, rental and roadside pay for and which are required.

Canonical page: https://statecover-guide.com/coverage/  
Last reviewed: October 28, 2026 by the StateCover Guide editorial team  
General information, not legal or insurance advice.

## Quick answer

A car insurance policy is a bundle of separate coverages, each with its own job, limit or deductible. **Liability** pays for harm you cause to others and is required in 49 states and the District of Columbia. **Collision** and **comprehensive** pay for damage to your own car. **Personal injury protection**, **medical payments** and **uninsured motorist** coverage pay for injuries to you and your passengers. **Gap**, **rental reimbursement** and **roadside assistance** are optional extras that fill specific holes.

## Key facts

| Fact | Detail |
|---|---|
| Jurisdictions that require liability insurance | 49 states and the District of Columbia |
| States with no-fault laws, where PIP is central | 12, plus Puerto Rico |
| Average premium for liability, collision and comprehensive (2023) | $1,438 a year, about $120 a month |
| Average spent per insured vehicle, all policies (2023) | $1,281 a year, about $107 a month |
| Average collision claim (2022) | $7,191 |
| Drivers who were uninsured (2023) | 15.4% |
| Drivers who were uninsured or underinsured (2023) | 33.4% |

## The main types of car insurance coverage

The Insurance Information Institute (Triple-I) describes a basic auto insurance policy as six core coverages, each priced separately: bodily injury liability, property damage liability, medical payments or personal injury protection, uninsured and underinsured motorist, collision and comprehensive. Insurers also sell add-ons such as gap, rental reimbursement and towing. The table shows who and what each one pays for.

| Coverage | What it pays for | Whose loss | Required? |
|---|---|---|---|
| [Bodily injury liability](https://statecover-guide.com/coverage/liability/) | Injuries you cause to other people, including their medical bills and lost income | Other people's | In 49 states and the District of Columbia |
| [Property damage liability](https://statecover-guide.com/coverage/liability/) | Damage you cause to other people's cars and property | Other people's | In 49 states and the District of Columbia |
| [Collision](https://statecover-guide.com/coverage/collision/) | Damage to your car from a crash, rollover or pothole, whoever is at fault | Yours | No; lenders and lessors require it |
| [Comprehensive](https://statecover-guide.com/coverage/comprehensive/) | Theft, vandalism, fire, hail, flood, falling objects, animals and glass | Yours | No; lenders and lessors require it |
| [Personal injury protection (PIP)](https://statecover-guide.com/coverage/personal-injury-protection/) | Medical bills and, in many states, lost wages and other costs, regardless of fault | You and your passengers | In no-fault states and some others |
| [Medical payments (MedPay)](https://statecover-guide.com/coverage/medical-payments/) | Medical bills only, regardless of fault | You and your passengers | In a few states, such as Maine and New Hampshire |
| [Uninsured and underinsured motorist](https://statecover-guide.com/coverage/uninsured-motorist/) | Your injuries when the at-fault driver has no or too little insurance, or in a hit-and-run | You and your passengers | In some states; others require insurers to offer it |
| [Gap insurance](https://statecover-guide.com/coverage/gap-insurance/) | Loan or lease balance above the car's value after a total loss or theft | Yours (the lender is repaid) | No; generally required on leases |
| [Rental reimbursement](https://statecover-guide.com/coverage/rental-reimbursement/) | A rental car while yours is repaired after a covered claim | Yours | No |
| [Towing and labor (roadside)](https://statecover-guide.com/coverage/roadside-assistance/) | Towing a disabled car and roadside labor such as a flat tire change | Yours | No |

## How the coverages fit together

It helps to sort the coverages into four groups by what they protect.

- **Protecting other people from you:** bodily injury and property damage liability. This is what state laws require, because it makes sure the people you hurt can be paid.
- **Protecting your car:** collision and comprehensive, with gap on top if you owe more than the car is worth.
- **Protecting the people in your car:** PIP, MedPay and uninsured and underinsured motorist coverage.
- **Keeping you moving:** rental reimbursement and roadside assistance.

Each coverage has its own limit or deductible, and each is priced separately. That means you can, for example, carry high liability limits with a high collision deductible, or keep comprehensive after dropping collision on an older car.

### Which coverage pays in common situations

| Situation | Coverage that typically pays |
|---|---|
| You rear-end another car and hurt its driver | Your liability pays for their injuries and car; your collision pays for your car, minus your deductible |
| You and your passenger need treatment after that crash | Your PIP or MedPay, and your health insurance |
| An uninsured driver runs a red light and injures you | Your uninsured motorist coverage for injuries; collision or uninsured motorist property damage, where offered, for your car |
| Hail dents your car in a parking lot | Your comprehensive, minus your deductible |
| Your financed car is stolen and never found | Comprehensive pays its value; gap pays any loan balance above that |
| Your car is in the shop for two weeks after a covered claim | Rental reimbursement, up to its daily limit |
| Your battery dies in a parking lot | Towing and labor coverage, an auto club or a manufacturer program |

## Required vs optional coverage

**Required by law.** Liability is the base requirement in 49 states and the District of Columbia. New Hampshire is the exception: its insurance department says you do not have to buy a policy, but you must be able to pay for damage you cause, and any policy you buy must include medical payments and uninsured motorist coverage. On top of liability, many states add their own requirements:

- **PIP** is part of the no-fault system in 12 states plus Puerto Rico, including Florida, Michigan, New York and Massachusetts. Some other states, such as Texas and Maryland, also put PIP on policies unless you reject or waive it.
- **Uninsured motorist coverage** is required in states such as New Hampshire, Maine, New York, Massachusetts and Maryland. Others, such as California, Texas and Florida, require insurers to include or offer it and let you reject it in writing.
- **Medical payments coverage** is required in a few states, such as Maine and New Hampshire.

**Required by a lender or lessor.** If you finance or lease a car, the contract will normally require collision and comprehensive until the loan is paid off. The Triple-I says gap insurance is generally required on a lease.

**Optional.** Everything else, including higher limits, rental reimbursement and roadside help, is your choice. Optional does not mean unimportant: liability limits above the minimum and uninsured motorist coverage protect against the largest losses.

Use the [state minimums tool](https://statecover-guide.com/tools/state-minimums/) to see what your state requires.

## Limits and deductibles: how the numbers work

Coverages that pay other people, or pay for injuries, have **limits**: the most the insurer will pay. Liability limits are usually written as three numbers, such as 30/60/15, meaning thousands of dollars per injured person, per accident for all injuries and for property damage. California's minimum, for example, is $30,000 / $60,000 / $15,000. Our [liability guide](https://statecover-guide.com/coverage/liability/) works through an example of a crash that exceeds those limits.

Coverages that pay for your own car have **deductibles**: the amount you pay on each claim before the insurer pays the rest. The Triple-I says deductibles are typically $500 or $1,000, and that a higher deductible lowers your premium. The NAIC reminds drivers that you pay the deductible every time you file a collision or comprehensive claim. Collision and comprehensive have no separate dollar limit of their own; they pay up to the car's actual cash value.

Example: with a $500 deductible and $3,000 of hail damage, you pay $500 and comprehensive pays $2,500. With a $1,000 deductible, you pay $1,000 and it pays $2,000.

## How to build a policy that fits you

1. Start with your state's legal requirements, using the [state minimums tool](https://statecover-guide.com/tools/state-minimums/).
2. Raise your liability limits to a level that protects your savings, home equity and future income.
3. Set uninsured and underinsured motorist limits, often matching your liability limits, since 33.4% of drivers were uninsured or underinsured in 2023.
4. Decide on collision and comprehensive based on whether you have a loan or lease, what the car is worth and whether you could replace it yourself.
5. Add gap insurance if you owe more than the car is worth.
6. Compare PIP and MedPay with your health insurance to see what gaps are left.
7. Add rental reimbursement and roadside help only if you do not already have them another way.
8. Choose deductibles you could pay at short notice, then compare quotes from several insurers.

The [coverage checklist](https://statecover-guide.com/tools/coverage-checklist/) turns these steps into a personal list, and the [deductible chooser](https://statecover-guide.com/tools/deductible-chooser/) helps with the last step.

## What "full coverage" means

"Full coverage" is a common phrase but not a type of policy. It usually means liability plus collision and comprehensive. The NAIC's guide to shopping for auto insurance says there is no such thing as a full coverage policy, and a policy called full coverage can still carry minimum liability limits or leave out gap and rental coverage. Our guide to [full coverage car insurance](https://statecover-guide.com/coverage/full-coverage/) explains what it costs on average, at $1,438 a year in 2023, and how to decide whether full coverage is worth it.

## All coverage guides

- [Liability coverage](https://statecover-guide.com/coverage/liability/): What bodily injury and property damage liability pay for, how split limits work and how to choose limits above the minimum.
- [Collision coverage](https://statecover-guide.com/coverage/collision/): What collision pays for, how deductibles work, when lenders require it and how to judge whether it is worth keeping on an older car.
- [Comprehensive coverage](https://statecover-guide.com/coverage/comprehensive/): What comprehensive pays for, worked examples, glass and deductible rules, and how to decide whether to keep it on an older car.
- [Full coverage](https://statecover-guide.com/coverage/full-coverage/): What people mean by full coverage, what it costs on average, what it leaves out and how to decide whether it is worth it.
- [Personal injury protection](https://statecover-guide.com/coverage/personal-injury-protection/): What PIP pays, how no-fault and choice no-fault states use it, and how PIP amounts and options differ from state to state.
- [Medical payments (MedPay)](https://statecover-guide.com/coverage/medical-payments/): What MedPay pays for, how it works alongside PIP and health insurance, and where state law requires it.
- [Uninsured motorist](https://statecover-guide.com/coverage/uninsured-motorist/): What UM and UIM coverage pay, how UMPD and stacking work, state requirements and how common uninsured drivers are.
- [Gap insurance](https://statecover-guide.com/coverage/gap-insurance/): What gap insurance pays after a total loss or theft, who needs it, where to buy it and how to cancel it for a refund.
- [Rental reimbursement](https://statecover-guide.com/coverage/rental-reimbursement/): How rental reimbursement pays for a rental after a claim, and how your policy, rental counter products and credit cards cover a car you…
- [Roadside assistance](https://statecover-guide.com/coverage/roadside-assistance/): What towing and labor coverage pays for, the limits to check, and how it compares with auto club and carmaker roadside programs.
## FAQ

### What are the main types of car insurance coverage?

The core coverages are bodily injury liability, property damage liability, collision, comprehensive, personal injury protection or medical payments, and uninsured and underinsured motorist coverage. Common add-ons include gap insurance, rental reimbursement and towing and labor.

### Which car insurance coverages are required?

Liability is required in 49 states and the District of Columbia. Many states also require PIP, uninsured motorist coverage or medical payments. Collision and comprehensive are not required by law, but lenders and leasing companies require them on financed and leased cars.

### What is the difference between collision and comprehensive?

Collision pays for damage to your car from crashes with vehicles or objects, rollovers and potholes. Comprehensive pays for almost everything else: theft, vandalism, fire, weather, flooding, falling objects, animal strikes and glass. Both pay up to the car's value, minus a deductible.

### What does full coverage car insurance include?

It usually means liability, collision and comprehensive, plus whatever your state requires. It does not automatically include gap, rental reimbursement or roadside help, and it may still carry minimum liability limits.

### Do I need uninsured motorist coverage?

Some states require it, and others require insurers to offer it. Even where it is optional, it protects you from the 15.4% of drivers estimated to be uninsured, and from drivers whose limits are too low to cover a serious injury.

### What is the difference between PIP and MedPay?

Both pay medical bills for you and your passengers regardless of fault. PIP is broader and can also pay lost wages and other costs; it is central to no-fault states. MedPay pays medical costs only and is often a smaller, optional coverage.

### How much is car insurance per month?

The NAIC's national average expenditure was $1,281 a year per insured vehicle in 2023, about $107 a month. A policy with liability, collision and comprehensive averaged $1,438 a year, about $120 a month. Your price depends on your state, record, car and the coverages you choose.

## Sources

- [Insurance Information Institute, What is covered by a basic auto insurance policy?](https://www.iii.org/article/what-is-covered-by-a-basic-auto-insurance-policy) — the six core coverages and what each pays
- [Insurance Information Institute, Background on: No-fault auto insurance](https://www.iii.org/article/background-on-no-fault-auto-insurance) — no-fault states and PIP
- [Insurance Information Institute, How much auto coverage do I need?](https://www.iii.org/article/how-much-auto-coverage-do-i-need) — typical deductibles; limits above the minimum
- [Insurance Information Institute, What is gap insurance?](https://www.iii.org/article/what-is-gap-insurance) — gap generally required on leases
- [NAIC, Auto Insurance (consumer page)](https://content.naic.org/consumer/auto-insurance.htm) — coverage definitions and optional coverages
- [NAIC, A Shopping Tool for Auto Insurance](https://doi.nebraska.gov/sites/default/files/doc/ShoppingGuideAuto.pdf) — no full coverage policy; deductibles on every claim; towing, rental and gap
- [NAIC, 2022/2023 Auto Insurance Database Report](https://content.naic.org/article/naic-releases-20222023-auto-insurance-database-report) — national average premiums and collision claim costs
- [Insurance Research Council, Uninsured and Underinsured Motorists: 2017–2023 (press release)](https://www.businesswire.com/news/home/20250220231032/en) — uninsured and underinsured driver rates
- [New Hampshire Insurance Department, Automobile Insurance Consumer Frequently Asked Questions](https://mm.nh.gov/files/uploads/nhid/documents/nh-auto-guide.pdf) — financial responsibility and required coverages if insured
- [Texas Department of Insurance, Auto insurance guide](https://www.tdi.texas.gov/pubs/consumer/cb020.html) — PIP, UM, towing and rental coverage; lender requirements
- [California Department of Insurance, Automobile Insurance (Form 101, text version)](https://www.insurance.ca.gov/01-consumers/105-type/95-guides/01-auto/auto101.cfm) — split limits and California minimums