What is a car insurance? What will a car insurance cover?
Car insurance companies cover you and your passengers in case of an accident. But its up to you to determine the level of protection you get.
Should the damage to your property be covered by the company? Will all passengers be covered or just your family? What happens if your daughter drove your car?
What questions should you ask your car insurance company regarding car insurance? This article will help you choose between different insurance policies.
Types of car insurance
Liability insurance or third party insurance.
This is generally the minimum form of insurance offered by an insurance company. This is the basic insurance, if you are involved in an accident, and it has proven to be your fault, the insurance company will pay compensation to the other party.
The cover offered by the insurance company is usually set in advance. These are the maximum amount that the insurance company will pay in case of an accident
For example, the agent will agree on a coverage of 10000 per person bodily injury and or 400,000 coverage in bodily injury and or 10000 in property damage per accident
You must confirm with your car insurance company what to cover and what are the limits.
You may be offered a very low premium by a certain car insurance company to realize that your cover is minimal and unrealistic.
Collision and comprehensive coverage, comprehensive insurance and full comprehensive insurance
An auto insurance company will also offer you comprehensive insurance, as the name indicates, you will be extensively covered.
Simply put, it means that if you are responsible for a collision, the insurance company will pay for the repair of the vehicle.
But its not that simple, a car insurance company will almost always have the final say on what amount to be paid, so if its cheaper to give you market value for the car, theyll do it.
You may think your car is worth 1000.00 but the actual market value may be 500.00. This is not an unusual scenario. So if the repair of your car is more than 500.00 then the car insurance company will simply pay the cars book value.
You must ensure that the insurance company does not control the cars market value, usually organizations like AA provide an unbiased market value.
As with third parties the insurance company will almost certainly limit the amount that will be paid out, but generally a comprehensive insurance will have higher limits.
A recreational vehicle needs its own insurance, a car insurance for recreation is not the same as car insurance.
You should not assume it because your car is completely insured, so is your leisure vehicle.
Other types of car insurance
Medical MedPay, Persona Protective Protection PIP and no fault protection
This insurance will cover you and your passengers medical expenses in case of a collision.
The wrong protection means that the car insurance company pays no matter who is wrong. This gives you the feeling that your family and friends are at least covered.
PIP is often a minimum requirement in some countries or states, ask your car insurance company what the requirements are.
Uninsured underinsured drivers coverage
This protection including sometimes a minimum requirement in some states will cover you if the wrong person is not insured or under insurance.
You must ask your car insurance company what you will be charged in such a situation. Normally, the car insurance company should not charge any additional premiums.
Rental allowance, towing and labor
The extras often provided with comprehensive insurance are often used by car insurance companies as special offers.
So if your car is damaged, the car insurance company will pay for rental costs sometimes only for a few days.
The car insurance company can also offer to pay for the withdrawal of your vehicle, not included.
As always, you should ask your car insurance company what is included in the cover.
The legal requirements.
Most states, and most countries will require a certain coverage, from complete total car insurance to third party car insurance.
In most cases, it is for you, the driver, to make sure that your car insurance company offers you the lowest requirement. In most cases, the insurance company car insurance company is not required to instruct you about the requirements.