If you own a car, you must have automobile insurance. Yes, it's the law, but you also need it to protect yourself.
Here are the most important things to know about automobile insurance:
1. The premium is what you pay the carrier to be insured. The deductible is what you must pay before your carrier pays anything on a claim.
2. The higher the deductible, the lower the premium.
3. There are two types of coverage – collision and liability.
4. Collision insurance covers car damage whether caused by you or another driver. If someone else was at fault, your carrier – after it pays you – owns your claim against the other driver and can sue him to recover its losses. This is called subrogation.
5. You may not need collision coverage if your car isn't worth much. You need to do a cost-benefit analysis. What's the cost of collision insurance when weighed against the benefit that you'll be reimbursed for your car's value if it's totaled?
6. Liability coverage offers protection if you or someone driving your car damages another car or, worse yet, injures someone else.
7. Even if your car is worthless, you must have liability insurance to protect yourself against lawsuits. If you damage another car or hurt another driver, you could be sued. Your legal fees (including punitive measures levied by the court) will be paid by your liability coverage.
8. Carefully consider the deductible when choosing your collision coverage plan. If you have a $500 deductible and the value of your car is $2,000, your premium should be pretty low because you will pay the first $500 in the case of any damage.
9. There are no deductibles for liability coverage.
10. Different auto insurance companies have different appetites for new customers. We recommend you speak with an insurance broker (someone who works with more than one carrier) when you shop for automobile insurance.
11. You can also procure valuable information regarding automobile coverage. Two good ones are Progressive and Esurance.
Car insurance is a must for the company or the buyer of the car, because it covers all the car accident.You have to take into account that higher insurance rates have better protection when traveling.
Posted by: rebeca | May 11, 2011 at 10:47 AM