Defining Auto Insurance
Auto insurance policies provide important financial assistance when vehicles become involved in accidents. In every state, owners of motor vehicles used on state roads by law must purchase minimum levels of auto liability insurance. Customers enjoy wider discretion in obtaining additional coverage.
Who Needs Auto Insurance?
Anyone who owns a vehicle should obtain auto insurance. This type of protection offers valuable assistance paying medical bills and other expenses if an accident occurs. Auto insurance may enable a vehicle owner to obtain the funds necessary to purchase or lease a replacement auto if an accident damages the insured vehicle beyond repair.
How It Works
Insurance boards in every state regulate auto insurance. State laws concerning insurance rates vary from one jurisdiction to another. For example, the same insurance company sometimes must charge customers in different locations different rates, as a result.
Most auto insurance policies include a deductible. Customers pay this sum out-of-pocket. Customers usually enjoy the ability to select a high deductible to help lower their insurance premiums. If an accident occurs, the customer may file a claim for auto insurance coverage. An insurance adjuster examines the accident to determine the extent of the loss and the amount due the customer (or other people injured in the accident).
Different Types of Coverage
Customers purchase at least the minimal level of required liability insurance to help compensate people injured in accidents involving their vehicles. Many drivers seek higher levels of liability coverage in order to enjoy broader liability protections. They may also choose variable levels of comprehensive coverage to obtain financial reimbursement for property damage (including vehicle damage) in a variety of situations. Policies sometimes cover auto thefts.
Auto insurance brings vehicle owners peace of mind knowing insurance will help pay bills if auto accidents result in deaths, injuries, or property damage. Most states today subscribe to “no fault”” auto insurance (they require every driver to file a claim with their own insurance company for compensation after an accident, regardless of who actually cause the mishap).