CAR INSURANCE: KNOW TO GO
Insurance Before Car - Why?
Even before you have the key of your new auto in your hand, experts advise you to get some auto insurance knowledge. You might think it is a trick propagated by the car insurance companies. You are wrong. They say so because the moment you sit behind the wheel, you are responsible for your safety. Also, you need auto insurance for abiding by your state law. Not getting an insurance policy may prevent you from having your car registered unless the state law offers you a waiver. Caught without, you may be fined up to a thousand dollars!
But car insurance is something you just cannot go shopping and get. At least, you should not. Why? You might ask. Because, auto insurance has no cash value. That is, you keep paying unless you are unluckily luckily unlucky to meet a mishap to get anything.
To Understand Your Compulsory Policy
You need to have your knowledge-base of auto insurance ready before you go shopping. The very first thing you should know is about the types of auto insurance that exist out there. That is to say, you need to know -
what type of car insurance you are buying.
what it covers for you.
what price you are going to pay for it.
So it is good to know that auto insurance policies largely fall in two major categories—
Compulsory that you are obliged by your state law to purchase. ( Compulsory Insurance Policy does not cover loss or damage to your auto.) And,
Optional that you may buy at your sweet will.
Let me throw some light on the compulsory category today —
The Compulsory insurance come in parts or different policies. The difference are based in the characteristics of coverages that each offer. You compulsory coverage is defined by your state law. So a compulsory coverage in your state may be an optional coverage in another, or vice-versa. The following policies are compulsory almost USA-wise where auto insurance is mandatory.
Personal Injury Protection
is popularly known by its acronym PIP. Its coverage includes basic economic protection for you in case of an accident that you cause or you are caused to.PIP is known as no-fault policy as your insurance coverage works no matter who is at fault.
As per your state law, you will require to have a minimum or minimum-plus-as-you-like coverage for each of the first three of the following coverages:
is popularly known by its acronym PIP. Its coverage includes basic economic protection for you in case of an accident that you cause or you are caused to.PIP is known as no-fault policy as your insurance coverage works no matter who is at fault.
As per your state law, you will require to have a minimum or minimum-plus-as-you-like coverage for each of the first three of the following coverages:
Medical expenses are covered as stated in the contract between you and the insurance company you signed up with.
Compensation for your wages loss for the injury that you have sustained because of an accident.
Replacement Services Pay works if you need to employ someone for you inability to work due to the accident.
Funeral Expenses may also be covered under many company products.
PIP is compulsory in Delaware, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, Pennsylvania, Texas and Utah.
Beneficiaries are anyone on board during the accident, including the driver you approved for driving the auto.
Liability
is your compulsory car insurance policy that pays to another driver when you cause an accident. For the other driver to claim the compensation, he requires to prove that you are at fault. Liability is known as at-fault because it works when you are at fault or responsible for a mishap. Liability falls in the following two groups:
is your compulsory car insurance policy that pays to another driver when you cause an accident. For the other driver to claim the compensation, he requires to prove that you are at fault. Liability is known as at-fault because it works when you are at fault or responsible for a mishap. Liability falls in the following two groups:
Bodily Injury Liability works when you cause bodily injury or death to another driver.It has two limits--one for single person and the other for more than one person.If more than two persons are affected, the total coverage will split.
Property Damage Liability works when you cause damage to another’s property like home-boundary, garden, fence etc.
Your state law will require to buy a minimum or minimum-plus coverage. The coverage is $100000 in most states.
Your state law will require to buy a minimum or minimum-plus coverage. The coverage is $100000 in most states.
Liability Insurance is compulsory in Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine.
Under-insured/Un-insured is the car insurance policy that covers medical expenses beyond your PIP coverage. The insurance company pays for your medical expenses for this part when you are victim of an accident and the driver that caused you accident is under-insured or does not have enough liability coverage for your treatment. Similarly if he is uninsured you will get medical benefits if you have the coverage.Uninsured or Underinsured comes in two limits--for single person and for more than one person. The coverage splits when there are more than two persons involved.
How to Go?
Shop as much as possible. Ten is best. Go both online and offline. Get quotes.
Compare not only the prices but also the coverage levels. Give thinking time to decide between the good, better and best.
The best is the one that takes the least and guarantees the highest.
Ask your broker or agent if there are ways to lower the price.
Think if the add-ons (if any) are necessary at all. If a few bits ensure potentially big bucks, it is probably okay.
Make sure the insurer is state-approved.
Listen to what everyone says—keep the deductible high to save money now.
PIP is where it is good to make a handsome purchase.
A Personal Explanation
Details of coverages are not given here as I think it is wise to check them for yourself. They may vary from insurer to insurer as well.
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