Let’s start by addressing one big, fundamental thing: There’s no one thing called “car insurance.” Car insurance is a collection of different policies that cover you in different ways. Here’s how they break down:

Liability coverage – These policies help cover your rear-end when you’ve hit another car and it’s your fault. The money will go to the people you hit, it won’t cover the people in your car.

• Bodily Injury Liability (BIL) – This policy pays for other people’s medical expenses. You’ll often see BIL policies described as a “20/50” policy or a “100/300” policy. These numbers describe the maximum dollar amount the policy will pay for a single person’s injuries and the maximum for all the injuries sustained by all the occupants of the other car. So, for example, a 20/50 policy will pay out as much as $20,000 for a single person’s injuries, and up to $50,000 for injuries to everyone who was in the car you hit.

• Property Damage Liability – This policy pays for damage done to the other car. Property liability is sometimes referred to alongside BIL as a third number, so a 20/50/10 liability package will also up pay up to $10,000 for damage to the other car.

The following policies pay you if you’re in an accident and/or your car gets messed up:

• Personal Injury Protection – This covers your and your passengers’ medical expenses. If you lose time at work because of your injuries, this policy can also help cover lost wages.

• Uninsured/Underinsured Motorist Coverage – This helps cover costs if the car you hit doesn’t have insurance, or only has the required minimum.

• Collision – This policy gives you money to repair your car if it’s been in an accident.

• Comprehensive – This policy pays you if your car is stolen, or if it’s damaged without being in an accident.

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