Auto Insurance 101: Terms Every Driver Should Know

Auto insurance can feel confusing, especially when policies are filled with unfamiliar terms and coverage limits. Understanding what your coverage actually does is one of the most important steps in protecting yourself, your family, and your finances. Below are some of the most important auto insurance terms every driver should know — and why they matter.

Uninsured Motorist Coverage (UM)

Uninsured Motorist coverage protects you if you are involved in an accident caused by a driver who does not have insurance. Unfortunately, uninsured drivers are more common than many people realize. If an uninsured driver hits you, UM coverage can help pay for your medical bills, lost wages, and in some cases, vehicle damage — expenses you would otherwise have to cover out of pocket.

This coverage is especially important because even the safest drivers cannot control the actions of others on the road.

Underinsured Motorist Coverage (UIM)

Underinsured Motorist coverage applies when the at-fault driver does have insurance, but their policy limits are not high enough to fully cover your damages. Medical bills, vehicle repairs, and recovery costs can add up quickly. UIM coverage helps pay the difference when the other driver’s insurance falls short.

Without UIM coverage, you could be left paying thousands of dollars for an accident that wasn’t your fault.

Liability Insurance

Liability insurance is required in most states and is designed to protect others if you cause an accident. This coverage pays for the injuries and property damage sustained by the other party. It does not cover your own injuries or vehicle damage, but it does protect you from potentially devastating financial and legal consequences.

Having adequate liability limits is critical, as accidents involving injuries can result in costly claims and lawsuits.

Property Damage Coverage

Property Damage coverage pays for damage you cause to someone else’s property in an accident. This may include another person’s vehicle, a fence, a mailbox, a building, or other structures. Repair and replacement costs can escalate quickly, and this coverage helps ensure those expenses are handled properly.

Choosing the right limits helps prevent you from paying out of pocket for expensive repairs.

Bodily Injury Coverage

Bodily Injury coverage applies when you cause an accident and someone else is injured. This coverage helps pay for medical expenses, emergency room visits, rehabilitation, lost wages, and even legal fees if a lawsuit occurs. Injuries can result in long-term costs, making adequate bodily injury limits one of the most important parts of your policy.

This coverage protects both the injured party and your financial future.

Why Auto Insurance Is So Important

Auto insurance isn’t just about meeting legal requirements — it’s about protecting yourself from the unexpected. Accidents happen every day, even to cautious drivers. Without proper coverage, a single accident can lead to overwhelming medical bills, repair costs, or legal expenses that impact your financial stability for years.

Having the right auto insurance coverage gives you peace of mind knowing you are prepared for whatever the road brings.

How Greenbridge Insurance Can Help You Find The Right Auto Insurance Coverage

At Greenbridge Insurance, our team takes the time to help you understand these coverage options and how they apply to your unique situation. We believe insurance should be clear, customized, and affordable. Our agents will review your current policy, explain your options in plain language, and help you find the coverage you need — all while working to secure the best price possible.

Whether you’re purchasing a new policy or reviewing your current coverage, Greenbridge Insurance is here to guide you every step of the way.

📞 Contact Greenbridge Insurance today to learn more about your auto insurance coverage and make sure you’re properly protected on the road. (731) 772-5700