Auto Insurance -The Good, The Bad, And The Ugly

Auto insurance policies can often be very confusing however they are a necessary evil to protect you in case of a accident. They are designed to cover you, your passengers and of course any damage to your car. Auto insurance policies vary in price and features depending on the level of coverage you decide to purchase.

It is important that you consider a few important issues prior to purchasing a auto insurance policy. What amount of a deductible are you comfortable with should you get into a accident? Will the damages to your property be covered by the company? Will all the passengers be covered or only the driver of the vehicle? Will you be able to get a rental car in the event of an accident?

It is important to understand the various components of a typical auto insurance policy prior to signing on the dotted line. Rates will typically depend on the amount of coverage you purchase and you must always compare apples to apples when it comes to pricing auto insurance from multiple companies.

Liability or Third Party Auto Insurance

Liability insurance is the most basic form of coverage offered by insurance companies. What it means is that if you are involved in a accident and it is determined that you are libel or at fault the company will pay damages to the other party involved in the accident. In case of a accident the amount of actual coverage is determined by how much you sign up for when you purchase your policy.

An example of coverage amounts would be $100000 coverage per person bodily injury and $10000 in property damage per accident. It is your responsibility to confirm with your auto insurance company what they will cover and what are the limits of your policy.

It is important that you thoroughly check your auto insurance proposal as you might be quoted a very low premium only to realize that your cover is minimal and not sufficient for your particular needs.

Collision and Comprehensive Coverage

Collision coverage simply means that if you are involved in a collision the insurance company will pay for the repair of the vehicle.

It gets a bit sticky due to the fact the auto insurance company will always have the final say on what amount will be paid out for repairs. Their inspectors will recommend after market parts as opposed to original manufactured parts when repairing your car which tends to cut costs for the insurance company.

When appraising the damage the insurance company will never exceed the market value of your car. You might think that your car is worth $5000.00 but the real market value might be $3000.00 So if the repair bill exceeds the market value of $3000 then the auto insurance company will definitely cut their losses and pay the book value of the car as opposed to repairing the vehicle. This could leave you with no car and less money than you were banking on to purchase a new vehicle.

Comprehensive auto insurance is designed to cover your vehicle during non-collision type mishaps to your vehicle. Every year, thousands of cars, trucks and recreational vehicles are damaged due to theft, fire, natural disasters and vandalism. Without comprehensive insurance, your car will not be covered for this mishaps. When something unforeseen apart from head-on collision happens to your car, you can protect your investment and unforeseen outlay of money if you purchased appropriate comprehensive coverage.

Uninsured/Under insured motorists’ coverage

This coverage is designed to protect you in the event that the person at fault in the car accident is not insured or is underinsured. There oftentimes minimal requirements in some states for this type of auto insurance. This type of coverage is very important and is designed to protect you from unforeseen medical and repair bills.

Medical (MedPay) and No Fault Coverage

MedPay coverage will cover you and your passengers medical expenses in the event of a collision. The amount of coverage will vary depending on the amounts which are written into your auto insurance policy. The no fault coverage means that the auto insurance company will pay regardless of who is at fault. This give you the piece of mind that, at the very least, your family and friends are covered.

Rental Reimbursement, Towing and Labor

This coverage is important because you do not want to be left without a car in it takes a few days to weeks to get your car repaired. Make sure you have this coverage included in your auto insurance policy and also be aware of amount of allowance for towing, the amount of days allowed for a rental car and the daily allowance for the rental. You can always increase or decrease these parts of your car insurance policy depending on your needs.

Auto Insurance Discounts

There are many discounts available to the consumer and it is important that you are aware of them because they can ultimately lower your insurance premium.
Here are a few of the most common discounts available to you:

* Auto Safety Features Discount – Such safety features present in your car such as alarms, airbags, anti locking brakes and others can lower your premium via discounts.

* Multiple Vehicle Discount – You may be able to get a discount on your auto insurance premiums by having multiple vehicles on your auto insurance policy.

* Safe Driver’s Discount – With some auto insurance companies if you have a clean driving record for at least five years you are entitled to a discount.

* Full Time Student Discount – This may be available to you if you are a full time student and if you maintain a certain GPA you might be eligible for additional discounts.

* Auto Insurance Renewal Discount – If you have a clean driving record and have been with the same auto insurance company for many years, be sure to ask for a renewal discount.

Free Auto Insurance Quotes

One of the best ways to get the best auto insurance rate is to shop online where you can get a instant auto insurance quote.   Auto insurance companies are very competitive and with online access, it is much easier to rate and compare auto insurance companies. This will enable you to get the most comprehensive coverage at the lowest rate possible.