Shopping for Auto Insurance
If you have your license, you probably already know how important it is for everyone who drives to have auto insurance. In fact, most states require it by law. Some states require licensed drivers to have a policy with specific coverage while other coverage is optional. Auto insurance policies are a package of different types of insurance coverage including:
- Liability coverage pays for accidental bodily injury and property damages to others. Injury damages include medical costs, pain and lost wages while property damage includes damaged vehicles and property.
- Collision coverage pays for damages to your vehicle caused by a collision with another vehicle or object.
- Comprehensive coverage pays for damages that were not caused by an auto accident, such as floods, vandalism or theft.
- Medical coverage pays medical expenses despite of fault in an auto accident.
- Personal Injury Protection coverage pays for medical expenses for the insured driver, regardless of fault, due to an auto accident.
- Limits and Deductibles apply to certain types of coverage and determine how much the policyholder will have and how much the insurance company will pay when a covered claim is made.
Insurance companies have different policies that combine a variety of the different types of coverage. Therefore, when you choose a policy, it’s important to know the laws of your state to know the minimum coverage required. Begin with the state’s requirements, then consider the other optional coverage that will fit best with your needs.
Also, before buying car insurance, it’s important to consider some basic factors that will affect the rate of your auto insurance.
For instance, the type of vehicle that is being insured will affect the cost. A person driving a sports car can expect a higher rate compared to someone who drives a sedan; or if the car has a high theft rate, then its insurance rate will be higher than a car with a low theft rate. Essentially, though, your coverage rate will be determined on the value of your car.
Another factor that affects the cost of auto insurance is the location of where the policyholder lives. If the person who is being insured lives in an area where there is a high occurrence of accidents, the cost of insurance is expected to be higher. Therefore, a driver who lives in the city, where there are more people and cars, he or she can expect their coverage rate to be higher than someone living in a rural area. Also, the cost depends on how often the policyholder drives their vehicle. The more they drive, the greater the chance of being in an accident and so their rate will probably be higher as well.
Insurance companies also determine the cost of auto insurance depending on who is being insured. Insurers consider the driver’s age, sex, marital status and driving record into account to determine the cost of auto insurance.
Thus, before purchasing car insurance, compare your insurance quote with different companies. Talk to different insurance companies about the types of coverage offered, the various policies and the different rates to find the best auto insurance policy for you.
