Saturday, August 22, 2009

how are you covered by your auto insurance

Auto insurance means a mutual understanding with your insurance company to pay for financial losses that may occur due to an accident. Initially you pay the premiums & the insurance company will then pay for any financial loss that results & is in accordance with their policy clauses.

When you have to pay for damages that you have caused to anyone else while driving, getting auto insurance policy helps. What if your automobile gets hit for no fault of yours? If you have auto insurance, you can rest in peace.

how are you covered by your auto insurance?

Usually you will be given property, medical & liability coverage. All states want you to have a quantity of the coverages.

Auto insurance includes 6 different kinds of coverage:

* PIP or Personal Injury Protection covers treatment costs for injured drivers & passengers of the policy holder's automobile.
* Bodily Injury Liability covers the damage that a driver/policy holder causes to anyone else. The driver may be you or even your relatives members as mentioned in the policy.
* Collision is usually sold with deductibles between $250 & $1000. It pays for the damage incurred on your automobile due to collision with another car/object or if the automobile flips over.
* Property Damage Liability is functional when you or anyone who drives your automobile with your permission causes damage to another person's property. The property may be a automobile, lamp posts, fences & any other structure that you hit.
* Uninsured Coverage pays for any damage you face due to being hit by an uninsured driver. Under insured Coverage pays for the damage caused to you by a driver with insufficient insurance.
* Comprehensive coverage pays for any loss occurring due to theft, fire, falling objects, missiles, explosions or for damage that occurs not from a collision.

Do you need auto insurance?

Yes! If you want to protect your assets & want to be saved from the unnecessary hassle of parting with a lump sum amount at two times you need auto insurance. Besides, all states need you to have at least the maximum amount of insurance.

Check out the 5 most important things when choosing an auto insurance company:

How can you pick an insurance company?

1. Check if the company is licensed to provide auto insurance.
2. Carefully consider what the company is offering you for the price they are charging.
3. Find out if the company providing insurance is financially sound. Only a financially sound company can provide you peace of mind when you claim your insurance.
4. See if the insurance company has a nice service record. You may even refer to client/customer testimonials.
5. Make sure you feel comfortable with the company or the agent providing insurance. If you are not comfortable, then the company is not the right two for you.

How much should you pay for your insurance policy?

* Driving record - If your record is nice your premiums will be low & vice-versa.
* Number of miles driven per year - The lower the number lesser the premium. Accidents have more chances to occur if you drive more miles.
* location - The trend of accidents, probability of thefts, lawsuits, cost of medical treatment & automobile repair in your locality also determine the premium that you need to pay.
* Your age - Teenagers are charged over mature drivers with more driving experiences.
* Your automobile - Cost of your automobile, cost of repairs, likelihood of theft, safety record of your automobile also determine how much you will pay.
* The coverage amount - Bigger coverages want you to pay more premiums & also offer discounts at times.

Although the insurance quotes vary between companies & also states, there's several factors that determine how much you will pay for auto insurance.

What not to do when buying auto insurance?

Take a look at the 3 common mistakes to avoid when buying insurance.

1. Buying insurance that fits the state maximum requirements: It is always advisable to consider the factors that determine the cost of your auto insurance.
2. Considering cost alone when buying insurance: You may opt for a company that demands lower premiums. But check if the funds reimbursed will cover the damage that may be incurred.
3. Not being transparent about driving history: You may not get an accurate quote if you have not clearly & honestly mentioned your driving history. If this happens, then at a later date your policy might also get cancelled.

Getting auto insurance is the best thing to do to protect yourself from any financial loss that may occur as a result of some automobile accident. It is all a part of smart planning. Accidents are something they can't predict. The best thing to do would be to keep yourself prepared for any damage that may occur in future.

Article Source :
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