Auto insurance is an arrangement between you and your insurance company where you agree to pay a premium in exchange for the assurance that your insurance agency will pay for any vehicle-related financial losses during the term of the policy. You need car insurance because you are legally obliged to pay for losses you cause to others in the event of a car accident. Buying auto insurance is the surest way to ensure you can get your bargain. Some states require you to have minimum insurance in order to drive. You must also be insured to finance a car.
One of the first questions you will be asked when taking out car insurance is how much of the covered damage or deductible would you like to be responsible for? You can choose from $ 100, $ 250, $ 500, or $ 1,000. The higher your deductible, the lower your premium. However, keep in mind that the deductible is the amount you need to pay before your insurance company will support you. If you can’t afford to pay the first $ 1,000 of the damage covered, consider how much you can afford and choose a lower deductible.
Your coverage is broken down into each purpose for which you would need to be insured. One of the most common types of coverage is liability, which pays off when the insured driver is legally responsible for bodily harm and property damage caused to others. Personal injuries cover medical expenses, pain and suffering, lost wages and other special damages. Property damage includes property damage and loss of use. Liability also pays the cost of legal defense. Each state has a set minimum coverage that you must bear, but you can opt for higher amounts.
Personal injury protection pays the medical costs for insured persons even though they were to blame for the accident. It also includes rehab, lost wages, service replacements, and funeral expenses. Medical Payment Coverage pays medical and funeral expenses regardless of fault if the causes of these requirements are due to an automobile accident. The collision cover pays for damage to an insured vehicle caused by a collision with another vehicle or object. Your deductible applies to collision coverage.
Comprehensive coverage pays for loss or damage to an insured vehicle, unless it is damaged or lost as a result of a collision. Losses due to theft, fire, wind, hail, flood, vandalism, or impact with an animal would be extensive. Your deductible applies to comprehensive coverage.
The uninsured driver pays for loss or damage caused by another driver who does not have liability insurance. Underinsured car insurance pays off when the insured driver is injured in a car accident caused by a driver who has inadequate liability insurance. The rent reimbursement pays the cost of rental vehicles if your vehicle is taken out of service due to a car accident. Daily money limits may apply. Emergency Roadside Assistance pays the towing costs if your vehicle breaks down. Distance limits may apply.
Your policy generally covers you, your spouse, children and other family members who live in your place of residence, as well as anyone else who is permitted to drive your insured car.