There are many coverages available for a single car insurance policy, each designed with a different purpose in mind. State-required liability coverage, for example, is designed to compensate other drivers and passengers in case the insured driver causes an accident. Other coverages are customized to cover the driver, their passengers and their vehicle in case of injury or damage.

Car insurance may renew every six months or every twelve months. In general, car insurance policies will automatically renew as long as premiums are paid consistently. You can change your coverage at any time, however.

Beyond the required amount of auto insurance, we also recommend drivers carry:

• Comprehensive Coverage: This covers damages to the insured vehicle as a result of fire, hail, wind, falling objects, theft and vandalism.
• Collision Coverage: This covers damage to the insured vehicle as a result of a collision with another vehicle or object.
• Liability: This covers bodily injury and property damage the insured driver may cause to someone else while operating the vehicle.
• Personal Injury Protection: This insurance, also known as PIP, covers the medical expenses of the insured driver and their passengers after an accident.
• Uninsured/Underinsured Motorist: This coverage helps with costs relating to a collision or accident involving an uninsured driver.

Auto insurance prevents you from falling into debt after an accident, whether it be from fixing or replacing your vehicle to lawsuit costs for a victim after an at-fault accident. This insurance covers some or all of the costs after a motor vehicle-related accident so that you don’t have to pay for everything out of pocket.

While some parents and young adults may think less coverage will save money for a young driver, this may actually be riskier. Having lower amounts of coverage on a young adult's vehicle may lower insurance premiums, but it will also mean paying more out of pocket after an accident. For example, if the young driver wrecks their vehicle but doesn't have comprehensive coverage, they could be looking to pay thousands of dollars out of pocket in repairs, or else be left without a vehicle.

Young adults are also statistically more likely to be involved in crashes and wrecks, so it's recommended that they carry full coverage auto insurance on their vehicle.

You should carry at least the minimum state-required liability insurance. Other coverage limits should be calculated based on the value of the vehicle and likelihood of injuries or claims.