Many lives have been saved as their auto insurance ensured that they were quickly and adequately treated when they were involved in an accident. Several people have also been saved from going bankrupt. This has made auto insurance to be emphasized in several countries and states.
Financial protection provision against damage
Auto insurance meant for every type of vehicle including cars, motorcycles and trucks among others. They are used primarily for financial protection provision against damage to your car or bodily injury when you are involved in an accident as well as the liabilities you can get from such events. There are several types of auto policies as well as auto insurance companies.
The major coverage of policies is regulated by the state and national government. The actual terms of the auto insurance policy however vary and is dependent on the state and federal government regulation, the type of policy as well as the companies. This is because different companies might have different offers on the same kind of policy in a particular country. Here are the types of auto coverage. The tips to cover when choosing an insurance policy company would also be discussed.
Comprehensive and collision insurance coverage
This insurance entails protection for your vehicle even when you are responsible for the accident. It will, however, be within the jurisdiction of the company to decide whatever they want to pay to you. You will be paid the amount your car is worth if that is the most affordable option for them.
There are cases where the actual value for your vehicle in the market is about $4000 while you think the real value is $8000. This happens frequently. When the company realizes that it will cost them more than $4000 to fix your car in the case above, they will rather give you the $4000 as opposed to repairing your vehicle.
It is necessary for you to ensure that it is not within the jurisdiction of the company to determine how much your car is worth. It should be concluded that a neutral body, who is not partial such as the AA, gives the actual value of your vehicle.
However, you tend to be paid more with the comprehensive policy, compared to the third-party insurance policy.
Liability or third-party insurance
The liability or third-party insurance is in most cases the least type of auto coverage which auto insurance companies. Everyone is expected to have this fundamental policy. When you are a victim in an accident, investigations would be carried out to check who is responsible for the accident. Once the inquiry is completed, the party who is at fault would be known. If you happen to be at fault, your insurance company will pay damages to the person you collided with.
The type of damages that your company will cover will already be decided when you are getting the coverage. The highest sum the insurance company would pay to you, in the event you get into an accident will also be agreed upon.
For example, the agreement could imply that the auto insurance company will pay each person involved in an accident and obtained bodily harm $5000 or a total of $20000. You can also agree for $5000 damage to properties.
It is thus pertinent for you to know what exactly the coverage is the company offers and what their maximum amount for each of the coverage is, this is to avoid companies that give you extremely low premium, and then you later discover that you cover is not realistic and very small.
You will need to get a different insurance for your car if it is a recreational car. The comprehensive insurance does not cover your recreational car.
Labor, towing and rental reimbursement
When you are under a comprehensive insurance, you will get some extra benefits like returning the money you spend on towing the car and those you devoted to renting another vehicle before your car is fixed. Other companies, however, offer this at specials, this means they could decide to either pay for these charges or not. In most cases, these terms are not included in the policy.
No fault cover and personal injury protection
If you and the people in your car should get hurt during an accident, the insurance will pay for your treatment. The no-fault cover implies that you will be paid, irrespective of if you are at fault or not, this gives you a level of peace for yourself as well as other members of your families and friends.
In many countries as well as several states in the United States of America, the minimum requirement is for you to have a personal injury protection insurance.
Tips to consider when choosing an insurance company
You should choose a company that offers the type of policy you are interested in. There are cases where the damages some insurance coverage pays are very low. You should get to know the kind of coverage they have and what their maximum payment is. You should also consider companies that give a discount auto insurance second chance; this is more so if you had credit problems in the past or if your driving record is not perfect.
A good example is Praetorian Insurance company QBE that give a good record of driving rewards to their customers. The insurance company you should choose should be flexible with incentives and selection of coverage. You should thoroughly check the company’s policy on auto insurance so as to know if they give car insurance discount rates when you keep a record of driving that is safe.