While there are many types of insurance, auto insurance is one of the most common and probably the type that most people are most familiar with. In fact, most consumers are already familiar with the leading auto insurance companies and could probably recite their commercials by heart, particularly those featuring the ubiquitous small green reptile. Auto insurance is typically paid in monthly premiums and you receive your benefit once there has been some type of damages to your car or to someone else's property.

Because of its importance, most states now require auto liability insurance. Therefore, it is important for auto insurance customers to do their homework and fully understand the different types of policies offered, the amount of coverage needed and other services offered by auto insurance companies in order to make informed decisions.

When purchasing car insurance, you need to be familiar with the six types of coverage:

1. Bodily Injury Liability: this type of insurance pays for damages that you have caused.

2. Collision: this pays for damages to your automobile regardless of who was responsible.

3. Property damage: this covers damages to the property of others that you cause.

4. Medical Payments: this covers injury treatment and rehabilitation to the policy holder's car and their passengers.

5. Uninsured/ Underinsured motorist: this coverage applies to damages to you, your automobile and passengers caused by a driver who either does not have insurance or does not have enough insurance.

6. Comprehensive: this type of insurance covers occurences such as floods, vandalism, hail etc. It includes damages that are not caused by collisions.

Key Points:

1. To save money, increase your deductible, this will lower your monthly premium.

2. Make sure you have enough bodily injury liability insurance!!!