Why is car insurance needed?

== == In most civilized countries, vehicle insurance is MANDATORY, so that if you are hit by another car, that driver's insurance company will pay for the damage to you or your car. You also have to have an insurance policy to protect others from your actions while driving your car. A insurance policy has coverage limits, that are agreed between you and your insurance company. Not too many individuals have 5 million dollars in their personal savings account at the bank, but the insurance company does, and if needed, they will cover you for an agreed limit of up to 5 million dollars, if you are sued for damages you have caused to some one else with your car. You pay them a annual premium towards the cost of having that insurance coverage, based on your driving record, and how much your car is worth to replace, if damaged beyond repair, and where you live.