Car Insurance

Car insurance can be broken down into a specific number of coverage sections. By reviewing this article, you should be better equipped to make a car insurance buying decision. We will cover the basic sections in a car insurance policy.

Car insurance protects you against financial loss if you have an accident. It is a contract between you and the insurance company. You agree to pay the premium and the insurance company agrees to pay your losses as defined in your policy.

A car insurance policy is comprised of a number of different kinds of coverage. Most states require you to buy some, but not all, of these coverages. If you're financing a car, your lender may also have specific requirements that you have to follow.

• Bodily Injury Liability: pays for bodily injury to another person due to the negligent operation of your vehicle. It may also pay if a resident member of your family, or a person who had your permission to use your vehicle caused the damages. For a list of the minimum bodily injury liability and property damage liability limits required in each state, click here.
• Property Damage Liability: pays for the damage you caused, due to the negligent operation of a vehicle. It may also pay if the damages were caused by a resident member of your family, or by a person who had your permission to use your vehicle.
• Uninsured Motorist Bodily Injury Coverage: provides coverage for "Your" physical injury that was inflicted by an uninsured driver who was at fault or for injury you sustain as a result of a hit-and-run driver who was at fault.
• Underinsured Motorist Bodily Injury Coverage: pays above the limits of another insurance policy for physical injuries you may sustain if your limits of Bodily Injury are higher than the limits of the at fault motorist's policy.
• Medical Payments: covers medical and possibly funeral costs for you or those riding in your vehicle that may be injured or killed in an accident while in your vehicle. May also pay for you or resident family members if struck by a vehicle while walking or riding in another vehicle. This coverage usually pays even if you were responsible for the accident.
• Collision Coverage: pays the cost of repairing or replacing owner's vehicle when damaged due to an accident. Cost of this coverage is usually alterable by choice of a deductible. The higher the deductible (the amount you agree to pay) the lower the cost is for this coverage.
• Comprehensive Coverage: pays the cost of repairing or replacing owner's vehicle when damaged due to Fire, Theft, Flood, Wind, Vandalism, Riots, Storm, or Earthquake, etc. Costs of this coverage are usually alterable by choice of a deductible. The higher the deductible (the amount you agree to pay) the lower the cost is for this coverage.
• Custom Equipment coverage, if available, would cover custom non-factory items such as CB radios, Cellular Phones or Custom Sound Systems. This coverage may also be available to cover customized features found of Conversion Vans.
• Towing Coverage pays for the costs towing or minor repair to your disabled vehicle. (Limits vary from company to company). Considering a motor club instead of using your insurance policy for coverage? Take a look at your options AAA or Nation Safe Drivers.
• Car Rental pays for the cost of a rental vehicle while yours is being repaired due to a Collision accident or Comprehensive loss. (Limits, usage and length of time available vary from company to company) Take a look at current rental vehicle rates from Alamo or Avis. You might want to be sure your current policy provides a limit that will cover the total cost.

Most auto policies are for six months to a year. Your insurance company should notify you by mail when it’s time to renew the policy and to pay your premium.

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