Car insurance protects you against any financial loss that
may happen due to an accident or theft of your car. It is a car insurance
company that issues car insurance to you. A car insurance company will work up
a car insurance policy for you after evaluating the various options like the
make of your car, the premium that you are willing to pay, your insurance risk,
etc. A yearly premium has to be paid by you to the car insurance company so
that the company can pay for your loses that you may bear in the future. All
the terms and conditions are mentioned in the contract and it is your duty as a Car owner to look over all the points and ask the
insurance agent any questions that you have in mind. It is only after all the
terms and conditions are clear to you that you should sign on the dotted line
and pay the premium.
Normally all car insurance companies have the same insurance
policies. The premium to be paid and the percentage of losses to be covered in
case of any accident may vary slightly. Since the car insurance market is very
competitive, the premium rates and other terms and conditions almost remain the
same.
A car insurance policy may provide property, liability and
coverage depending on the type of policy. The property coverage covers losses
for damage of the car or the theft of the car. Liability coverage pays for any
legal liabilities to other people for bodily harm or property damage. And
medical coverage covers expenses for treating injuries, medicine expenses and
funeral expenses in case of a car accident. You may buy the different types of
coverage depending on how much you want to spend on your policy.
A car insurance policy usually consists of 6 types of
coverage. As mentioned before a customer can select from the different types of
coverage. Most of the car policies last from six months to a year. Your
car insurance company will bill you when it is time to renew your policy and be
prepared for a rate hike.
The different types of coverage are
Bodily Injury Liability
This type of liability covers the expenses of injuries that
you may cause to someone else while driving your car. Also the coverage
includes injuries caused to a person while driving other person's car.
Medical Payments and Personal Injury Protection
This type of liability covers the expenses for the treatment
of injuries to drivers and other passengers. The liability also covers medical
expenses and funeral expenses in the case of death.
Property Damage Liability
This type of liability covers for damage to the other
person's car and your car. It may also include damage to lamp posts, telephone
poles, fences and other public property.
Collision
This type of liability covers expenses for damage to your
car or the other person's car. Even if you are at fault, then also you will be
reimbursed for the expenses of repairing the car.
Comprehensive
This liability covers loses due to theft or damage to the
car by something other than collision with another object or damage to the car
due to fire, falling objects, explosion, earthquake, etc.
Uninsured and Underinsured Motorist Coverage
This liability covers damages to your car by another driver
who is uninsured.
The coverages mentioned above are offered by all car
insurance companies. In almost all states, car insurance is mandatory.
Therefore, it is your responsibility as a car driver to have a policy.
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