A frequently
asked question today, especially among new drivers, is “What
types of car insurance are there?”; Generally
speaking, most auto insurance companies offer the
usual comprehensive, collision, and liability plans, as
well as more customized policies. Are you confused yet?
Because you know that the insurance you choose greatly
impacts your family’s financial security, understanding
what each type of insurance plan offers is essential to
picking what is right for your situation.
First of all,
your state probably insists on minimum liability
insurance. This means that you are required by law to
carry insurance for damage done to another person’s car
or body in an accident. In some states, you can go to
jail if you are in an accident and do not have this
coverage. But do know that this kind of insurance only
protects the other driver? Your own vehicle’s damage
comes out of your own pocket. Now you’re
probably wondering what happens to your own car if you
need to get it repaired or replaced. The answer is that
you need collision coverage. This protects you if you
are at fault in an accident. Having uninsured motorist
coverage can also be really beneficial. If the accident
isn’t your fault, but the other driver doesn’t have
liability insurance, uninsured motorist insurance
protects you and gets you back on the road.
Finally, you need to understand about comprehensive
coverage which protects you if a tree falls on your car
in the middle of the night, or if vandals smash your
windows. With comprehensive coverage, you are protected
against a variety of damages which could happen when you
are not in the car. Theft, fire, hail, and flooding are
just a few other possibilities that comprehensive
coverage can handle. Other kinds of car insurance
include work loss coverage, gap insurance, rental car
reimbursement, towing, labor, custom parts, and
equipment replacement, to just name a few. After this
brief explanation answering “What
types of car insurance are there?" you will
need to decide what plans most fit into your family’s
financial strategy. Going without proper auto insurance
is a risky and often disastrous mistake, but one that
can easily be avoided.
