Auto insurance is a compulsory practice across all states in America except for New Hampshire and Wisconsin. Auto insurance covers any liability or physical harm resulting out of an accident. The auto insurance takes care of the medical charges, vehicle damage repair, and other involved costs. The government has laid down strict rules and regulations to refrain the motorists from defaulting against covering their vehicles. As per these rules, it is binding for every motorist to have the auto insurance coverage, failing which they have to bear the imposed fines.

The auto insurance can protect the insured party, the insured vehicle, the third party as well as the vehicles damaged as a result of accidents or any other physical harm caused due to a calamity. The coverage depends on the insurance policy that is chosen by the vehicle owner. Some of the coverage policies can be listed as below:

> Liability Auto Insurance Coverage:

In some states, the law necessitates the motorists to carry the liability insurance coverage to ascertain their ability to reimburse for the harm that they have caused. This policy does not hold true for the individual living at the same residence as that of the insured motorist, unless explicitly included in the insurance policy as a member. This coverage can be claimed by the insurer who is held responsible for either a Body Injury or Property Damage. Liability coverage is available in two forms.

Combined Single Limit: It covers both the body injury and property damage aspects of liabilities. That is in case of an accident involving a third party, if it has led to a passenger's physical injury as well as damage to the third party vehicle, then this combined single limit policy covers both these incidents under a single unit.

Split Limits: It covers the body injury and property damage aspects as two separate units. Body injury will be treated as a different incident and will be covered under a different policy than that for the Property damage.

> Non-Owner's policies or Named Operators Policies:

This policy gives the driver the right to claim the insurance amount in the event of an accident while he is at the wheels, irrespective of whether he is or is not the owner of the vehicle. It is mainly useful for the individuals who have been defaulters in the past and had their license invalidated. Obtaining this policy will help them in scoring in the good books of the law enforcing officers and getting back their licenses.

> Comprehensive Policies:

These policies can reach out to the hired vehicles in addition to the private vehicles. However, this policy is not applicable to rental cars, as the insurance company does not want to shell out more insurance claim for the rental car than the actual worth of the insured vehicle.

Besides these policies which are purely based on the incidents, there are behavior based insurance policies which are dependent on the attitude of the motorist toward driving and the proper usage of the vehicle.