What is Auto Insurance Really All About?

 Auto insurance is an agreement between you and your insurance company where you arrange to pay a premium in an exchange for the peace of mind that your insurance agency will pay for vehicle related financial losses during the duration of the policy. You need auto insurance because you are liable by law to pay for losses you cause to others in the event of an automobile accident. Purchasing auto insurance is the surest way to guarantee you will be able to fulfill your end of the bargain. In some states it is required that you have minimum forms of insurance in order to drive. You also must have insurance in order to finance a car.

One of the first questions you will be asked when obtaining automobile insurance is how much of the covered loss or deductible do you want to be your responsibility? You may choose between $100, $250, $500, or $1,000. The higher your deductible the lower your premium however you must keep in mind that the deductible is the amount you must pay before your insurance will assist you. If you cannot afford to pay the first $1,000 of the covered loss you may want to consider how much you can afford and choose a lower deductible.

Your insurance coverage is broken down into each purpose you would need to be covered for. One of the most common coverages include liability which pays out when the insured driver is legally responsible for bodily injuries and property damage they cause to others. Bodily injury damages cover medical expenses, pain and suffering, lost wages and other special damages. Property damage includes damaged property and loss of use. Liability also pays legal defense expenses. Each state has a set minimum amount of coverage you must carry but you may opt for higher amounts.

Personal injury protection pays medical expenses for covered individuals despite who is at fault for the accident. It also covers rehab, lost wages, replacement of services and funeral expenses. Medical payment coverage pays medical and funeral expenses regardless of fault when the causes of these requirements are due to an automobile accident. Collision coverage pays for damage to an insured vehicle caused by collision with another vehicle or object. Your deductible will apply to collision coverage.

Comprehensive coverage pays for loss of or damage to an insured vehicle unless is damaged or lost as the result of a collision. Comprehensive would cover losses due to theft, fire, wind, hail, flood, vandalism or impact with an animal. Your deductible will apply to comprehensive coverage.

Uninsured motorist pays for loss or damage caused by another driver who does not have liability insurance. Underinsured motorist coverage pays when the insured driver is injured in an automobile accident caused by a driver who has an inadequate amount of liability insurance. Rental reimbursement pays rental vehicle costs when your vehicle is put out of commission as the result of an automobile accident. Daily monetary limits may apply. Emergency roadside assistance coverage pays towing expenses when your vehicle breaks down. Distance limits may apply.
Your policy will generally cover you, your spouse children and other family members who reside in your residence as well as anyone else who has permission to drive your covered automobile.

About the Author

Timothy Gorman is a successful Webmaster and publisher of Best-Free-Insurance-Quotes.com. He provides more insurance information and offers free money saving home, life, health and auto insurance quotes that you can research in your pajamas on his website.

 Tim Gorman

More Articles 

Auto Insurance Quote and Auto Insurance Quotes - Christian
Auto insurance quotes are a free service offered by insurance agencies to consumers who are in the market for new insurance. When you call an agency to obtain an auto insurance quote, you will be asked the driving record of the primary driver, the...

Car Insurance: Types of Insurance You Need to Understand - Sara Chambers
America has become a culture of cars, SUV's, minivans and sports coupes. With all this traveling in and out, back and forth around the maze that is the United States infrastructure, its easy to understand why auto insurance is required in order...

Getting the best life insurance quote. - Stacey Zimmerman
Copyright 2005 Stacey Zimmerman Your life insurance quote is primarily dependant on a number of personal factors, namely your health, family history, lifestyle and age. It's not possible to physically change any of these factors and you definitely...

5 Steps To Cheap Car Insurance Premiums - UK Insurance Index
Although car insurance is compulsory, it's not necessary to pay more than you have to. A few simple steps combined with some time surfing for competitive car insurance rates really can save you serious money. Step 1 - Excess The easiest way to...

Discount Auto Insurance - Keep Your Hard-Earned Money - Peter Crump
Finding discount auto insurance is so easy when you do an online search. There are many insurance companies that do offer this option for many customers who want to search through several different companies to get the best possible quotes. With...

Health Insurance policy choices - Tony
There are two primary types of heath insurance programs these are Managed Care Health Insurance and Fee-for-Service Health Insurance. There are both similarities and differences in health insurance plans so let's examine each type of policy. ...

Pet insurance - Not only is it inexpensive, but it can save you a bundle. Read and find out why you can't afford not to have a pet health plan. - Dean Cecere
Pet insurance has been and still is a growing concern with pet owners alike, due to the increasing amount of necessary trips to the veterinarian. Some of these trips can be extremely expensive depending on the reason for your visit. Routine check...

Are you running the risk of an uninsured business? Beware get a “Business insurance” - Mansi gupta
Are you running the risk of an uninsured business? Beware get a “Business insurance” Human life is precarious and so are the activities they indulge in. So it is not just the human life that needs to be protected but the work that he does - his...

Car Insurance online quote - Chris Gunnels
Car Insurance online quote with a state by state guide. Auto insurance is designed to protect you, your family, and your investment (your automobile) in the case of an accident. Based on a profile of the primary driver (including your driving...

Life insurance, the universe and everything - cashzilla
You may have noticed that life insurance is coming back into fashion. It’s true that it may not be the financial term on everybody’s lips, but sales of life insurance have been going up, according to the Association of British Insurers. Whilst we...

Cheap Term Life Insurance is Available Everywhere - Ivon T Hughes
Cheap term life insurance is easier to get than most people think. Dealing with a life insurance company has been made much simpler thanks to the Internet. No more spending hours of precious time with insurance agents. You can get the best term life...

Why Should I Go To A Life Insurance Broker? - Peter Crump
A life insurance broker is a dedicated person that encourages and listens to the needs and wants of a person looking for life insurance. It doesn't matter what type of life insurance you are looking for, whole or term life. A broker will be able to...