Auto Insurance Basics – What You Need to Know

July 10th, 2014 by Shawn Reynolds in Auto Insurance, Insurance Basics No Comments »

Understanding the basics of car insurance is a great way to start your search. This way, you can confidently negotiate the best rate and one that fits your specific needs.

car insurance, auto insurance

To begin, there are 4 basic types of coverage.

  1. Liability Coverage: Covers injuries to others and any damage to their property. This insurance is required by law and can typically be acquired at very low rates, as it is the absolute minimum you must have to operate a vehicle.
  2. Comprehensive Coverage: This coverage includes your vehicle and property in instances that do not involve a collision, less your deductible. Examples include theft, fire, or a fallen tree limb. There are several other covered instances but this just gives you a general idea of when you would use this coverage. This is an optional coverage but is sometimes required by banks that hold your loan to protect their collateral.
  3. Collision Coverage: This coverage applies in the instance of a collision and would repair the damages to your property, less your deductible. An example of a collision is if you were to collide with another vehicle or even single car accidents such as hydroplaning. There are several instances where collision coverage would be applicable but these are just to give you a general understanding. Collision coverage is also optional and is sometimes required by the company that holds your loan to protect their collateral.
  4. Uninsured Motorist Coverage: This covers situations where someone without insurance injures you or a family member.

These are the basic coverages that you need to familiarize yourself with so that you know what you are purchasing when you walk into an insurance agency. Understanding the terminology of auto insurance allows you to determine what you and your personal property situation actually need.


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Shawn is the CFO and Co-Founder of Signature Insurance Group. In addition to his being raised in a family whose involvement in the insurance industry stretches back six generations, he has personally been in the business since 1999.

Shawn enjoys spending time with his wife, Holly, and three sons, Braxton, Hudson, and Maddox.

Shawn can be reached at

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