What you need to know about auto insurance
Whether you own a car or not, you need insurance if you ever drive one. Knowing the requirements for auto insurance can help you ensure you get the right kind of policy and the right amount of coverage.
What is it?
Insurance coverage for automobiles falls under the category of property/casualty insurance. Depending on the type and scope of coverage you have, an auto policy provides you liability protection to pay for damages and injuries you cause in a crash as well as coverage for damage to your own automobile.
Who is it for?
Auto coverage is for anyone who drives a car, even occasionally, since an auto policy typically covers the driver rather than the car owner if the two are not the same.
How does it work
An auto policy covers you for liability purposes if you get into a crash and, if you have the right coverage, it also may cover an auto that you own as well. If you get into an accident, you need to contact your insurance company or agent as soon as possible to get a claim started. This is important even if it appears the other driver may be at fault. Once liability is determined, your insurer will pay the other driver’s costs if necessary and pay for damage to your automobile if you have the right coverage.
Types of coverage
There are a number of different types of auto insurance coverage. Liability coverage pays for damages you cause to others in an accident that is your fault. This coverage is required of drivers in nearly every state. Collision coverage will pay for damage done to your car in a crash if you are at fault or if the other driver’s insurance won’t pay. Comprehensive coverage pays for damage to your vehicle from something other than a crash, such as weather or fire damage. Other common coverages include uninsured motorist and personal injury protection.
The main benefit of having an auto policy is protecting yourself against causing damage to others in a crash. Another benefit is protecting your own car through collision and comprehensive coverage.