Auto insurance is necessary for a person regardless of his driving skills. The scope and type of coverage required would determine the appropriate policy.
Auto insurance is mandatory in most states. Although a person might feel that driving around without car insurance could save him a lot of money, there are many reasons why buying auto insurance cannot be avoided. Most states in the US expect a person to buy at least a minimum amount of car insurance. The minimum amount varies from state to state, although the 50/100/25 principal is generally recommended. This would mean $50,000 for a person injured in an accident, $100,000 for all injured parties, and $25,000 for property damage. Consumer reports, however, put these figures at $100,000 per person, $300,000 for all accident casualties, and $100,000 for property damage. A person’s driving license may be suspended for driving without insurance. In fact, most insurance companies are unwilling to provide insurance to people who did not previously insure their vehicle.
Type and Amount of Coverage
Nowadays, auto insurance can be easily purchased online. The first step is to decide the type of insurance required. The premium would depend on the kind of coverage. More comprehensive the coverage, higher the premium. The following types of coverage are generally available: basic, comprehensive, collision, property damage, bodily injury, medical payments, personal injury protection, uninsured motorist coverage, emergency roadside assistance, rental car reimbursement, and auto glass replacement. The basic coverage insures against bodily injury and property damage caused to the counter party in an accident. Property also refers to public property that might have been damaged due to the accident. Comprehensive, as the name suggests, covers all unforeseen events, except accidents. This coverage is useful for people who fear auto theft, vandalism, explosions, earthquakes, and other such calamities. Collision insurance, on the other hand, is meant to protect against car damage due to any kind of collision. One does not need to pay a premium for emergency roadside assistance, in case he is a member of an auto club.
Shopping Around for the Best Quote
Auto insurance companies have actuarial tables that document the probability of occurrence of all possible situations. Based on these tables, they provide quotes. These quotes are generally available online on completing a simple application, without a person having to provide sensitive information. In order to get an exact quote, a person would have to mention the type of coverage desired, provide a description of the car, the number of people likely to drive the car, their age, sex, and their license numbers. Of course, the premium on any policy would depend greatly on the driving record of the person seeking insurance. Any speeding tickets and accidents on record will raise the amount of premium. It would be advisable to keep a copy of the driving record at hand before shopping around for the best deal.
Most insurance companies provide discounts to drivers with a good driving record. Installing anti-theft devices in the car can also help in obtaining a discount. Sometimes, companies may provide discounts to youngsters who have completed a driver’s safety course. In addition to these discounts, one can avail discounts in case one has been with the same insurance company for many years. A smart way to avail discounts is to opt for group insurance, or insure more than one car at a time.
Checking Company References
A person should ensure that he is buying insurance from a reputable company with good financial prospects. One should also check for consumer complaints against the company.
Auto insurance is a must for every car owner. Just as a good credit rating helps a person get credit at lower rates of interest, a good driving record will lower the premium on various policies, and help one secure inexpensive auto insurance. A person should buy a policy that suits his needs. For instance, it makes no sense to buy comprehensive or collision insurance on a vehicle that has depreciated so much that it has no value. Similarly, personal injury protection is unnecessary for a person covered by a good health insurance.