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FAQ: Demystifying Auto Insurance Definitions
What is property damage coverage?
Property damage coverage is much like it sounds: it helps you pay for damages to another person's property (such as a fence, car, or home) if you cause an accident. This form of auto insurance coverage can also help protect you in the event of a related lawsuit. Property damage coverage is thus one of the most important types of auto insurance coverage in your auto insurance policy.
When you damage your own property you can choose what is worth repairing and then do it according to your own timeline. If you damage someone else’s property, the person is probably not going to be quite as flexible.
Consider the cost of a new car on average—over $20,000. If you’re responsible for destroying someone else's car, you may be responsible for $20,000. If you cause an accident which destroys someone's Porsche, you’ll be liable for $40,000-$50,000 of damage. If you hit someone's house in an accident, structural damage to a home could easily top $50,000. Spending a few extra dollars a month is well worth your while if you ever end up in one of these situations!
Because it's such an important coverage, most states require you to have property damage coverage as a part of your auto insurance policy. However, the low limits required in some states are typically not enough to protect you and your household.
Remember that when you buy auto insurance coverage, you should purchase the highest limits you can comfortably afford in order to obtain maximum insurance protection. Property damage coverage provides a lot of protection and is inexpensive. In fact, it costs only a few dollars more to purchase a higher level of coverage. When you get your quote from Esurance, you’ll be able to adjust your limits in order to see what levels of auto insurance coverage fit you best. Accidents happen, so be prepared and make sure you’re covered!
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