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Auto Insurance

Let’s Talk Auto Insurance

Experiencing a car accident, it becomes easy to understand the need for good car insurance protection for property loss and the costs from any injury. There is also the fact that driving a motor vehicle without car insurance coverage can result in costly fines and other penalties.

What It Is

Auto insurance is basically an agreement between the insurance company and the individual being covered that obliges the policyholder to be consistent with the monthly (or semi-annual) premium payments in exchange for compensation for any covered losses in the event of an accident or some other kind of covered loss. States require that drivers show financial responsibility and this usually comes in the form of minimum basic coverage.

Types of Coverage

The liability aspect of coverage, (that which is normally required by law), pays out for damages to other vehicles and property from an accident that is caused by you. Collision coverage compensates for any damage to your own vehicle from a crash, while comprehensive is what assists with a myriad of forms of loss that are the consequence of such things as weather, vandalism or theft. This component is what can pay for damage to your auto caused by anything other than collisions.

Who Benefits?

In virtually all states, those who drive a motor vehicle are mandated to buy, at the very least, liability coverage. If you carry a loan on your car, the lender will also require that you have not just liability but some level of collision and comprehensive coverage as well.

How it Functions

If you are involved in an accident, you then file a claim as soon as possible with your insurance provider. If you’re the one at fault, your insurance company will handle whatever damages that are covered by your policy. This takes effect after you have paid a previously agreed upon deductible. Of course, this is assuming that you have kept up on your premium payments as well. If the other driver is found to be at fault, then his or her insurance company will compensate for damages. Some important things to remember when involved in an accident: Be sure to exchange information with the other drivers, find witnesses for supporting testimony, obtain photographs, etc. (Anything that can help your case should it be required.)

The Benefits

This coverage helps keep the policyholder from being held financially responsible for potentially costly out-of-pocket expenses. Essentially, there are a couple of main benefits in buying good car insurance. First, it protects you from any financial loss you might suffer, along with liability protection. In obtaining a proper insurance plan, you can have peace of mind in knowing that you will be compensated for damage to property (including your vehicle) and, should you be at fault, that you will have the ability to pay for damages to another driver’s vehicle and any additional property damage that is the consequence of the accident.