Auto insurance is a contract between you and your insurance company that protects you financially in the event of an accident, theft, or other covered incidents. It typically consists of several types of coverage, each serving a different purpose: 1. Liability Coverage: This is the foundation of any auto insurance policy. It pays for the damages and injuries you cause to others in an accident. Most states require drivers to carry a minimum amount of liability coverage. 2. Collision Coverage: This pays for the repairs or replacement of your vehicle if it's damaged in a collision with another vehicle or object. 3. Comprehensive Coverage: This covers damage to your vehicle that's not caused by a collision, such as theft, vandalism, or natural disasters. 4. Personal Injury Protection (PIP) or Medical Payments Coverage: This helps cover medical expenses for you and your passengers if you're injured in an accident. 5. Uninsured/Underinsured Motorist Coverage: This protects you if you're involved in an accident with a driver who doesn't have insurance or doesn't have enough coverage to pay for your damages.