Types of Auto Insurance
Law makes it compulsory for every automobile owner to get their vehicle insured. A basic minimum coverage is mandatory, but there are extra options you might want to use to expand your coverage. With a large number of insurance plans available, it is necessary to understand different types of coverage.
Liability Coverage
If you meet an accident and you are at fault, liability coverage pays for the medical bills and vehicle repairs of the third party. This type of insurance does not cover your medical bills and repair cost of your car.
Collision Insurance
Collision insurance pays for the cost of vehicle repair or replacement of the vehicle. It subtracts the amount of your deductible. The deductible amount is the sum you will have to pay out of your pocket in case of a collision.
Comprehensive Insurance
Comprehensive insurance covers the damages not caused by collisions or accidents. In a case of theft or flood or a natural disaster, comprehensive insurance protects you. Generally, comprehensive insurance is purchased along with collision insurance.
Uninsured Motorist Insurance
Although, the law requires all drivers to drive with an auto-insurance. In case, a driver causes an accident but does not have an auto-insurance, uninsured motorist insurance covers the expenses. This insurance covers your medical expenses, and vehicle repair costs up to a limit, depending on the plan.
Underinsured Motorist Insurance
Underinsured motorist insurance works just like uninsured motorist insurance. If a driver's auto insurance covers only a portion of damages occurred, underinsured motorist insurance will pay for the remaining costs.
Medical Payments Coverage
This insurance pays for your medical costs after an accident. Whether you are held responsible or the other party, medical payments coverage protects you in both the cases. It can apply to the fellow passengers if the insured person is driving the vehicle. It can cover the insured individual if riding as a passenger. It can also apply to the covered person as a pedestrian as well.
Personal Injury Protection Insurance
Personal injury protection covers your medical expenses due to an accident regardless of fault. This type of insurance can provide payments for lost income due to an accident, child care costs and funeral expenses as well.
Gap Insurance
Gap insurance covers the losses that may arise when the compensation received after the vehicle damage does not cover the amount entirely, insured owes on the financing.
For, e.g., Bob owns a car which is valued at $10,000. He owes a total of $15,000 to the bank as an outstanding loan amount for the vehicle. In a case of theft or total damage, his auto insurance can reimburse him the full value of the vehicle, i.e., $10,000. Bob's Gap insurance company will pay for the gap amount of $5,000 in such a scenario.
Without the gap insurance, Bob will have to pay for the gap amount from his pocket, even though, Bob no longer owns the car as it is entirely damaged.
Towing and Labor Insurance
Towing and labor insurance pays the cost of towing the car to a repair shop if it cannot be driven. It covers the labor charges up to a specified amount at the place of the breakdown. Some of the most common items covered under towing and labor insurance are towing, tire changing, lockout services, fuel, oil, water refilling and battery services.
Rental Reimbursement Insurance
Rental reimbursement insurance pays for the cost of a rental car after your vehicle meets an accident or suffers damages covered under your insurance policy. The rental cost of the car you use until your car gets repaired is reimbursed under this type of insurance.
Classic Car Insurance
Classic car insurance covers your collectible vehicle at a value that you and the insurance company both agree. Collectible cars, for, e.g., an old Roll's Royce from the 60s, generally increase in value as they get older if properly cared. Standard rules of depreciation don't work on the classic cars. That's why you need a classic car insurance if you own a classic car.
In Summary the type of auto insurance you need depends on your situation. What car you drive, mortgage, other insurances and many other factors determine your insurance needs.
Insurance Tips for Car Buyers
Being responsible citizens, we all know that it's illegal to drive without valid car insurance. It's not only a question of violating the rules and regulations of the country but more importantly, you're compromising on your safety in the absence of an auto insurance.
Everyone loves a good deal. Because of this, everyone wants to get a cheap car insurance online. Aside from being able to spend less on the insurance itself, one also gets to be free from additional costs involved in actually going to the provider's location. There is also a lot of time saved since all it takes is the Internet, which is accessible anytime anywhere.
However, not everyone is as knowledgeable about the ways of the Web. There are a lot of considerations to bear in mind when doing business online. To avoid any unpleasant after effects, it helps to learn how to do things the right way.
Here are some Insurance tips for car buyers who wish to get their cheap auto insurance:
1. Research about the different standard Auto insurance policies available today
Most of the leading providers in the insurance industry offer more or less the same types of car insurance. There might be slight differences in each policy as insurance companies are constantly innovating to make their policies more saleable than that of their competitors.
2. Learn about the present car insurance policy if there is any
For those who wish to have their current policy, it is most helpful to check out the present one and use it as a guide in determining the details that should be included in the new one as well as those that one does not need.
3. Do away from additional coverage
It is typical for most people to commit the mistake of having useless add-ons with their policies. These make the payments larger than they already are. When looking for cheap auto insurance, stick with the basics and the most important stuff to avoid any costs that one can do without.
4. Know about the state requirements
There are federal laws about car insurance in the whole country. In addition to that, the states have also imposed their set of regulations that drivers in their territories should follow strictly. These involve certain facets of the policy such as the amount of coverage required for drivers in the state.
5. Check out the different providers
The number of insurance providers available today is continuously growing. Certain advantages and disadvantages come with every option. While working with the big names in the industry offer greater security in the investment, they might be too large to accommodate the particular preferences of each consumer they are providing service for.
6. Feel free to ask questions
When in doubt or confused about certain things regarding the policy, one should never hesitate to ask someone who knows about these things. Relying mainly on one's ideas on such things may bring negative results. Besides, there is nothing wrong about being honest that one does not know everything.
There are many options available when it comes to cheap auto insurance when buying a new car. This is something one can easily take note of when checking out the Internet. Hence, one should always be alert to avoid scams and similar unwanted and unpleasant circumstances.
CAR INSURANCE FOR YOUNG DRIVERS
Statistically, young drivers are more likely to cause an accident and make an insurance claim compared to the average drivers. As a result, auto insurance costs for young drivers tend to be high. Even though getting a cheaper car insurance plan for young drivers is pretty difficult, there are plenty of tips you can implement to help in scaling down the exorbitant premium costs. This article will disclose to you tips on how to save money on auto insurance for younger drivers and their parents.
1. Avoid Car Modifications
Car modifications like body kits and alloy wheels often fascinate a majority of young drivers, especially those interested in personalizing their cars. Unfortunately, these modifications are known to increase auto insurance premiums by hundreds of dollars. Thus, it is wise to steer clear of such modifications if you are looking for the best insurance for young drivers. If it is compulsory for you to pimp your car, then consider replacing the modified parts with cheaper ones.
2. Choose one of the Cheapest Cars for Young Drivers
When searching for your first car, the insurance cost is often a huge factor in the buying process. The cheaper the car you buy for your young mate, the lower the insurance premium.
3. Pay Your Premiums Annually
With the average auto insurance premiums for young drivers running into thousands of money, it can be pretty tempting to drag payments instead of paying for the insurance cover in one go. Rather than paying monthly, it is cheaper to pay for the entire year, if you are in a position to. By avoiding the monthly interest expenses, you will definitely save a significant amount of cash.
4. Use the Black Box Policy (Telematics)
Black box policies use a small device or an app installed in the car to monitor driving and car usage behavior. Telematics can help to cut insurance costs for young drivers because the insurer is able to determine the premiums based on actual driving behavior instead of just assuming that every young driver is at risk of causing an accident and making an insurance claim.
5. Decide the Level of Cover you need
There are about three different types of car insurance plans including third party fire and theft, third-party only, and comprehensive. The third-party cover caters for claims against you if you are involved in a road accident and you injure someone. It also takes care of the replacement or repair cost of the other person's car. On the other hand, the comprehensive insurance policy not only covers other vehicles but also your car in case of an accident. Even though the third-party policy might seem the cheapest for young drivers, it is averagely more costly than the comprehensive cover. Do your own assessment to decide the policy that suits you perfectly.
6. Add a Second Reliable Driver to your Policy
Adding a second driver who is more experienced and older can help in reducing the auto insurance cost for young drivers. However, ensure you steer clear of fronting because it is illegal.
There are a number of costs for young drivers who are getting on the road for the first time. These expenses can range from car tax, the cost of the car, and the first auto insurance cover. One of the most expensive costs among the ones outlined here is the car insurance premium. The tips revealed on this page will help young drivers and their parents to significantly lower the cost of their initial auto insurance cover.