There’s a lot of variation among the types of car insurance, and knowing which one is best for you can be complicated to figure out. Not only are there different types of coverage, from

liability

comprehensive

and

collision

, but there are different types of policies, rates, and legal requirements, too.

Here’s what you should know when figuring out what kind of car insurance you need, with a little help from

car insurance

comparison and broker app

Jerry

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Know your state requirements

The federal government does not expressly mandate car insurance, but instead leaves those decisions to be handled at the state level. As a result, rules will vary across the country. Most states have minimums that drivers must meet for bodily injury liability per person and accident, and property damage.

Remember, though, not all states are the same. In fact, New Hampshire does not have mandatory insurance laws while Arizona and Virginia have alternative laws that may obligate you to pay for damages from a collision you caused out-of-pocket.

With this in mind, it’s important to first check with your state’s DMV to determine what is required of you. This will not only help improve your efficiency at the DMV, but it will help empower you when talking to an insurance agent.

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How your credit score affects car insurance

Familiarize yourself with the types of car insurance

In general, there are three main types of auto insurance: liability, collision, and comprehensive. Many agents will also offer personal injury protection and uninsured/underinsured motorist protection.

Liability coverage

Liability is what can be considered "the minimum" in most states, as it covers your responsibilities in an accident where you’re at fault. This will help pay for the damages caused to the other vehicles involved.

Collision coverage

Collision covers the damages to your vehicle, even if it's totaled. There are some limits to how much damage — in dollars — it will cover, though.

Comprehensive coverage

Comprehensive protects your vehicle from damages out of your control, such as a tree falling on your windshield or a stolen car.

Other types of car insurance coverage

Perhaps not as common are personal injury protection, which will help pay for medical bills as a result of an accident, and

uninsured/underinsured motorist protection

, which will help protect you should you get into an accident with someone without insurance, or very minimal protection.

MORE:

Questions to ask when comparing insurance

How to determine what kind of insurance is best for you

When determining which type of coverage is best for you, keep your car’s value in mind. If it’s older, you might end up spending more than you’d like to for collision insurance that may not net the best financial return after an accident.

For example, a 2005 Subaru Outback may cost $733 a year to insure with collision coverage, despite only being valued at $3,718. Your yearly premiums thus exceed 10% of your total payout in an accident, which is your car’s value minus your deductible. 10% is generally seen as the cut-off point for collision. For most newer vehicles however, the investment into collision is well worth the price to protect such a valuable asset.

Comparison shop for the best insurance rate

Agencies can range from local independent shops, to national chains and direct sellers which omit the commission-based agent all together. What’s covered and how much will also vary, so it’s important to shop around and get quotes from more than one car insurance company before making a decision.

But you can consolidate that whole process into just 60 seconds by using the

Jerry

app! Jerry is the easiest and most effective way to find a

car insurance

policy that is customized for you.

After providing you with a comprehensive cross-analysis of the best policies across providers, Jerry will handle the phone calls, paperwork, and renewals for your top pick so that you don’t have to. They even help cancel your old policy! So why do all that extra work when Jerry can do it better?

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