A Small and Handy Guide to the Essentials of Car Insurance?

Answer 1

Car insurance can be a confusing and misunderstood coverage that leaves many people wondering if they are properly insured. Many do not understand what is covered, what is not, and what the right amount of protection is. Here are some quick tips to ensure that you and your car are taken care of.

One of the most important types of insurance for vehicles is liability coverage. This is required by law and protects the insured in the event that he or she causes an accident and damages another vehicle or causes bodily harm to another person. Without this type of automobile coverage, one can be sued for large amounts of monies and does not have the safety and security of the insurance company to pay any monies owed. The average amount of insurance is a $100,000/$300,000 limit.

Almost all other types of coverage on one’s car are optional. For instance, collision coverage protects the insured’s vehicle in the event of a loss. This protection is optional as it only pertains to the insured’s car and will only pay for their vehicle’s damages. In addition, most people have a $500.00 deductible, meaning that the first $500.00 needs to be paid by the insured prior to the company paying out any monies.

Comprehensive insurance works very similar to collision coverage. The main difference is that this type of insurance covers damages to one’s vehicle that are a result of vandalism or weather related losses. It is also optional and the average deductible is $250.00. However, one can choose to increase or decrease their deductible.

Medical payments is a coverage that is meant to pay the insured’s medical bills if he so she is injured in a loss. Limits can range from $5,000 to around $50,000. It is wise to have a higher limit on this insurance, especially if one does not have medical insurance.

In addition to the above car insurance categories, one can also include rental coverage, towing, and uninsured motorist coverage. These are also helpful as they can prevent a large amount of out of pocket expenses. When purchasing car insurance, be sure to thoroughly discuss what options work best for you with your company.