If you with your insurance agent for auto insurance, what's going on, you actually create several smaller political together, a car insurance. In this article I will explain what each part of what it does and why you need it (because if they do not).
While you'd think the term "car insurance" is pretty self explanatory in what it covers, it's actually more complicated than that (like so many things in life).
For example, you need insurance to cover any legal fees, lawyers, court costs that can result from a lawsuit if you are taken to court after an accident. It also needs to cover medication and medical bills for you if an uninsured or underinsured driver hits you and injures you. In reality, there are hundreds of potential costs that don't have much to do with your car that end up being covered by auto insurance.
So let's talk about three main components of car insurance - liability, comprehensive, and collision coverage.
Liability
This is the portion of your policy that will pay for the medical bills of anyone you injure in an accident if you're found to be at fault. It also pays for property damage you might cause, whether it's public or private property including the other person's car. Also, liability insurance isn't optional. Each state has minimum standards of coverage you are required by law to have before you'll able to legally drive your car or truck.
Comprehensive
I like to think of comprehensive coverage as the "acts of god" rider on your policy. While it's a little inaccurate, it helps me make sense of what comprehensive is in my head. For example, if you hit an animal like a deer on the road, the comprehensive policy is actually what kicks in here. If you're car is damaged by hail - again, comprehensive. Basically, this is the "circumstances beyond your control" portion of the policy.
Collision
Collision coverage is probably the simplest to understand. If your vehicle is damaged in an accident and it's your fault, collision is what will pay for the repairs to your vehicle (liability still pays for damage to other property and people).
Full Coverage
When you have a collision, comprehensive, and liability policy, you have what is commonly called full coverage. If you have a loan on your vehicle, the bank will require you to keep full coverage on your vehicle. If the vehicle is paid for, you can elect to go the route of liability only or just liability and comprehensive.
I hope this helps you understand what you're getting when you get an auto insurance policy and remember that if you have any questions or aren't comfortable with something, ask your insurance agent - it's their job to know this stuff backwards and forwards.