In almost every state, drivers are required to carry an adequate amount of insurance for their vehicles. This protects not only you but the other driver as well. When you are looking at auto insurance policies for you or a loved one, there are several things you need to look for while researching.
Types of Coverage
There are two types of auto insurance policies that most companies offer. The first type, most often referred to as a liability policy, protects not only yourself but the other driver as well. In the event of an accident, having adequate coverage pays for the damage to the other car if you are at fault, as well as any medical care they and the occupants may need as a result of the crash. Other protections are also built in, such as legal representation if the incident requires any type of litigation or lawsuit. One of the drawbacks to this type of insurance is that, unless your vehicle is considered a total loss, you will be responsible for the repairs to your vehicle, which can become very costly.
The other type of coverage is called collision. This type of insurance is also sometimes called full coverage. This coverage offers the basic protections of liability, but with the added advantage of protection for your vehicle as well. When you purchase a new vehicle, it is required by the bank holding the lien or title for your vehicle that you carry this full coverage insurance. This protects the bank or lender from taking a loss if the vehicle you are still making payments on is damaged and can bring your car back to like-new condition without causing a financial hardship.
Payments and Deductibles
The cost for auto insurance policies can vary greatly. There are factors that go into deciding the rate a company will offer. These factors can range from your driving history, any accidents or tickets that you’ve received and your personal credit history. All of these factors are included in the decision-making process that provides you with a quote. In some cases, the policy is broken down into a yearly or semi-annual quote. Many insurers offer a payment plan, and some may require a down payment. There are often several convenient ways to pay your premium, including online, a check through the mail and over the phone. If your office is local, you may be able to drop the payment off in person.
Deductibles are an important part of auto insurance policies. They exist to help reduce or increase your out of pocket expenses in case of a claim. The lower the deductible, the higher your monthly premium is likely to be. For some, having a higher deductible can be risky, but it will allow your payments to be more affordable. If you have any damage to your vehicle and need to file a claim, the total cost is paid after you have satisfied your deductible. You need to keep in mind how much you would be able to afford when making this decision.
Coverage and the Law
Driving without proper coverage is a dangerous and in most cases, unlawful practice. Auto insurance policies exist not only to protect the lender, but also your family and other people you may encounter in your travels, but also to help cover the very expensive costs that can mount in the case of an accident. Even with all of these laws in place, there are many people who go against the law and drive without coverage. Due to this irresponsible behavior, there are safeguards built into many insurance policies that pay into an uninsured motorist fund that can help protect people who are injured by those without a policy.
If you are caught driving without coverage, even if you are pulled over for a simple headlight issue, officers will immediately find out if you are driving without coverage. If you find yourself in this situation, you not only face tickets but in some cases, arrest, the suspension of your driving privileges and the impounding of your car. In an accident, you could find yourself owing countless thousands of dollars in damage and medical costs if you are at fault. There are many affordable auto insurance policies out there, so taking the time to find one that works for you is the best choice.