What Do All Those Terms Mean in My Auto Insurance Policy? A Georgia Driver’s Guide

When we meet a new client after a wreck and ask about their auto coverage, the answer is usually a shrug. People know what they pay each month. They rarely know what they bought. Mix in a few widespread myths, and most Georgia drivers are at the mercy of whatever their agent recommended years ago. This guide is our attempt at auto insurance policy terms explained in plain English, with an emphasis on the coverages that decide how a serious injury claim turns out.

Auto Insurance Policy Terms Explained: Start With the Declarations Page

Every policy has a one- or two-page summary called the declarations page, or “dec page.” It lists each coverage you bought and the limit for each. Everything in this article refers to a line on that page. If you cannot find yours, your insurer’s app or website will have it. Read it before you read the rest of this article. Most people are surprised by what is, and is not, there.

Two Myths That Cost Georgia Drivers Money

Myth one: “They caused the wreck, so their insurance has to pay my medical bills.” Not as they come in. The at-fault driver’s insurer owes you nothing until your claim is resolved, either by settlement or verdict. Your medical bills are an element of damages you recover at the end. In the meantime, the bills are paid by your health insurance, your own Medical Payments coverage, or you. Our article on who pays medical bills after a car accident in Atlanta walks through the options.

Myth two: “I have full coverage.” “Full coverage” has no legal meaning. It usually means the driver has liability plus collision and comprehensive, which protects the car. It says nothing about whether the driver has enough coverage to protect a person. The only way to know what you have is the dec page.

Liability Coverage

Liability coverage pays other people when you are at fault. Georgia requires minimum limits of $25,000 per person and $50,000 per accident for bodily injury, and $25,000 for property damage, often written as 25/50/25. Those minimums have not changed in years and are nowhere near adequate. A single night in an intensive care unit can exceed $25,000. If you seriously injure someone and carry minimum limits, your personal assets are exposed for the difference.

There is a second reason to buy more liability coverage that most agents do not explain: in Georgia, you generally cannot buy uninsured motorist coverage in an amount greater than your liability limits. Cheap liability limits cap the coverage that protects you.

Uninsured and Underinsured Motorist Coverage

This is the most important line on your dec page, and the one most often missing or too small. Uninsured/underinsured motorist coverage, or UM, pays you when the driver who hit you has no insurance, has too little, or cannot be identified, as in a hit-and-run. Roughly one in seven drivers nationally is uninsured, and Georgia’s rate has consistently been above the national average. Far more drivers carry only the 25/50 minimum. If your injuries are worth $200,000 and the at-fault driver has $25,000 in coverage, UM is the only place the other $175,000 can come from.

Georgia law, O.C.G.A. § 33-7-11, requires insurers to offer UM coverage and lets you reject it only in writing. It also gives you a choice between two types:

• Added-on (excess) UM pays on top of the at-fault driver’s coverage. With $100,000 in added-on UM and a $25,000 at-fault policy, $125,000 is available.
• Reduced-by (traditional) UM is reduced by whatever the at-fault driver’s insurer pays. With the same numbers, only $100,000 total is available, and your UM carrier pays just $75,000.

Added-on coverage costs a little more and is worth every dollar. Georgia generally allows you to stack UM coverage from multiple policies, so a driver hurt in a company vehicle may be able to reach the employer’s UM, their own UM, and a resident relative’s UM. Our articles on whether you need uninsured motorist coverage and recovering damages from an uninsured driver go deeper.

Medical Payments Coverage

Medical Payments coverage, or MedPay, pays your medical bills from a crash up to the limit you chose, regardless of fault, with no deductible. If you have health insurance, MedPay covers deductibles and co-pays. If you do not, it can be the only thing standing between you and collections while your claim is pending. Limits run from $1,000 to $50,000 or more, and the coverage is inexpensive.

MedPay has taken on new importance since Georgia’s 2025 tort reform law. For injuries on or after April 21, 2025, a jury may now hear evidence of what was actually paid for your treatment, not just what was billed. How your bills get paid, and by whom, can now affect the numbers in your case. Our summary of Georgia’s new tort reform laws explains the change.

Collision and Comprehensive

Collision pays to repair or replace your car after a crash, regardless of fault, minus your deductible. Comprehensive covers non-crash losses: theft, hail, flood, fire, a fallen tree, or hitting a deer. Neither is required by Georgia law, but a lender will require both. When the at-fault driver’s insurer is slow to accept liability, using your own collision coverage gets your car fixed now. Your insurer then pursues the other carrier through inter-company arbitration, and in most cases your deductible is refunded within a few months. Georgia’s UM coverage also includes property damage protection, subject to a $250 deductible set by statute, for cases where an uninsured driver damages your car.

The Rest of the Dec Page

• Rental reimbursement pays for a rental car while yours is repaired. Without it, you are negotiating with the at-fault carrier for a rental, often after a delay.
• Towing and roadside is self-explanatory and cheap.
• Gap coverage pays the difference between what you owe on a financed car and what it is worth if it is totaled. Anyone with a new car loan should have it.
• Umbrella coverage is a separate policy, usually $1 million or more, that sits on top of your auto and homeowners liability limits. It is inexpensive relative to what it protects, and many umbrella policies can be written to include excess UM coverage as well. Ask.

How Much Coverage Should a Georgia Driver Carry?

With the auto insurance policy terms explained, the remaining question is how much to buy. Every household is different, but after decades of seeing what happens when coverage runs out, our general advice is this: carry liability limits of at least $100,000 per person and $300,000 per accident, buy added-on UM in the same amount, add MedPay, and if you own a home or have savings, buy an umbrella. The difference in premium between minimum coverage and this package is often less than a monthly streaming bill. The difference in outcome after a serious wreck can be several hundred thousand dollars. Our older article on why you probably need more insurance makes the same point with examples.

Frequently Asked Questions

What does “25/50/25” mean on my policy?

Those are your liability limits: $25,000 per injured person, $50,000 total per accident for injuries, and $25,000 for property damage. They are Georgia’s legal minimum and protect other people, not you.

Does UM coverage raise my rates if I use it?

Georgia law generally prohibits insurers from surcharging you for a claim on which you were not at fault, and a UM claim is by definition someone else’s fault.

Can I add UM coverage after a wreck?

No. Coverage is fixed as of the date of the collision. The time to fix your dec page is now.

Questions About Your Coverage After a Wreck?

Understanding your own policy is the first step in any injury claim, and finding coverage the adjuster did not mention is often the difference between a fair recovery and a token one. Our Atlanta car accident attorneys review every policy that may apply to your case, at no charge. Call Hoffspiegel Law at (404) 760-8600 or contact us online.

This article is general information about Georgia law and is not legal advice about your specific situation.