It’s important that you understand the basics of what you are paying for and why it is necessary. By knowing these technical terms, you can make sure your auto insurance coverage is as complete and reliable as possible. If you are currently paying for any type of auto insurance, then these are some terms you should know to maximize the benefits of your plan(s).

Collision Coverage. In the event you need repairs or replacements if your vehicle collides with another vehicle or property, you’ll need this. The higher the deductible you elect, the lower your premiums will cost you. Don’t forget to check if this coverage is available in your plan!

Comprehensive Coverage. This is the coverage that pays for damage caused from falling objects, fire, certain natural disasters, theft and vandalism.

Property Injury Liability. Can you imagine how much it might cost should you accidentally drive into someone’s house? You wouldn’t want to be caught without property damage insurance should you need to pay for repairs to another vehicle, building or anything else you might hit.

Bodily Injury Liability. If you were at fault in an accident and others involved needed to go to the hospital and/or lost wages from missing work, those costs would come out of your pocket if you are not insured with Bodily Injury Liability. Many states require you to carry Bodily Injury Liability. This type of coverage can also help you in the event the other party takes legal action against you.

With these different types of liability coverage, you’ll quickly discover that unfortunate accidents soon become less dreadful then they seem.

New drivers such as student will typically have higher premiums than older drivers who have more driving experience. If the new driver has had a driver education course such as Driver’s Ed in high school, then you may be able to receive a discount. Many car insurance companies offer these discounts and because many states are requiring that students take these courses, then the situation is even better for you.

Some insurance companies also offer a Good Student discount. These programs award students by offering discounts to students who make good grades in school. If a student also takes a defensive driving course voluntarily, you may also be able to save by sending the certificate to the insurance company, as most insurance companies offer defensive driving discounts as long as the course was not a requirement for a speeding ticket.

They will also be able to see how being a good student allows you and them to save money on their insurance. Car insurance is also a good opportunity for students to learn responsibility. They should be able to help parents pay the premium through summer or part time jobs. They should also learn the effect that a traffic ticket or accident will have on their premium.

Many companies will offer “multi” discounts for car insurance. This means that if the policyholder has more than one car on their policy, then they will usually get a discount on the additional cars. Other insurance companies will offer auto and home insurance together and this can make paying your insurance even easier. If you are adding a new driver and car to the policy you may receive multi-driver and multi-car discounts.