If you own a car in the United States and plan to drive it on the highway and roads, then it is the law that you must have car insurance. Like anything to do with insurance these days, it can be a confusing topic. If you are looking for the very basic information regarding car insurance, here are the points you need to know.
What is Car Insurance?
Car insurance, or more appropriately, vehicle insurance is a policy for cars, motorcycles, trucks and other road vehicles. There are some vehicles, such as scooters for instance, which does not require insurance, but this is based on the size and speed of the vehicle. Car insurance is vastly important since it provides protection for your financial state and against physical damage or bodily harm if you are involved in an accident.
What is Basic Car Insurance?
The most basic policies might cover property damage, liability, collision and uninsured drivers, but the coverage for bodily harm is set at the least amount possible. This is where some people choose to cut corners since it provides a cheaper premium, but in truth, this could be the most expensive out of pocket cost to the insured.
Liability is considered to be part of the basic coverage and is aimed to protect the insured if they are the cause, intentional or not, of the accident. Liability is designed to protect you financially if you are sued because of the accident and other claims which may arise. Liability insurance is mandated by law in a lot of states, so be sure to check the regulations where you live before purchasing insurance.
Comprehensive insurance, which is also part of the basic coverage, provides coverage for your car in the case of an accident. Coupled with this is collision, and your property and vehicle are covered for repairs or replacement. Comprehensive is considered a supplemental policy and it covers damage to your car if it is damaged by an act of God, such as sleet/hail damage, it is stolen, or vandalized. While it is totally considered optional, it is a good policy to have to protect your financial status and lifestyle.
Care insurance is mandated by law in most states. Do your research before you buy. It can save you money in the long run and can also protect you.