Car insurance is something that is necessary if you own a vehicle. Auto insurance is a safety net to protect you and other drivers in the event of an accident. Most states require drivers to carry at least a minimum amount of car insurance. Understanding how it works and the basics can make the process of buying insurance easier, so you know where your money is going.
Who needs automobile insurance?
Anyone who owns a car needs to carry insurance on their vehicle. All drivers in the household have to be listed on the policy. Some policies offer additional protection for others who might drive your vehicles such as relatives, friends, or your boyfriend or girlfriend. Each policy has different specifications that outline who the policy covers.
What does it cover?
Car insurance covers, at minimum, property and bodily injury liability. These components pay for injury-related expenses, damages to property or vehicles, and legal costs if a lawsuit surfaces. The minimum coverage requirements might not be enough to pay for all expenses in the event of an accident, which is why you have the option to buy additional coverage.
Types of car insurance
Bodily injury and liability are only the minimum requirements states impose on drivers. You might need additional coverage to protect your assets. If you are at-fault in an accident, damages to your car won’t be covered unless you have collision coverage. Comprehensive coverage pays for damages to your vehicle due to other circumstances, such as a tree falling or during a windstorm or a broken window because someone broke into your car. Some policies offer additional perks such as rental car coverage or roadside assistance.
Benefits of auto insurance
Car insurance offers financial peace of mind. When you’re in an accident, you don’t want to worry about how you’re going to pay for medical or property damages for yourself, your passengers, or individuals in the other vehicle. You also gain legal protection to prevent a costly legal battle if you have inadequate coverage.
Protect yourself and your assets with adequate insurance coverage.