Understanding Your Auto InsuranceBy Tom McKnight
Reading auto insurance policies can be like trying to decipher advanced calculus. It's really not that difficult if you understand a few basic terms. Collision, Comprehensive, Bodily Injury Liability and Property Injury Liability are the main terms you need to fully understand.
You'll appreciate Collision Coverage in the event you need repairs or replacements if your vehicle collides with another vehicle or property. The higher the deductible you elect, the lower your premiums will cost you. If you're at fault for something, well of course it would still be an accident, as I doubt you'd plan to run into that guard rail, but how much would you be able to afford to pay out of pocket for repairs? $250? $500? $1,000? Just like medical insurance, you'd have to pay that deductible amount first and then the insurance company would pay for the remaining charges for the repair.
Another term to become intimately familiar with is Comprehensive Coverage. This is the coverage that pays for damage caused from falling objects, fire, certain natural disasters, theft and vandalism. Deductibles work the same way as with Collision; the more out of pocket costs to you, the less your insurance premium.
In addition to knowing how much Collision and Comprehensive coverage you have, you'll want to know about your liability coverage. Let's say you rear-end another driver. Or your foot slips off the brake onto the gas pedal and you plow down a mailbox. Your liability coverage will kick in and pay for the damages that you caused with your insured vehicle. You liability coverage will, or could, include bodily injury (people) and property damage.
You don't want to go without Bodily Injury Coverage. If you were at fault in an accident and others involved needed to go to the hospital and/or lost wages from missing work, those costs would come out of your pocket if you are not insured with Bodily Injury Coverage. It doesn't take a genius to know how quickly those amounts can add up. This type of coverage can also help you in the event the other party takes legal action against you. Many states require you to carry Bodily Injury Coverage.
The other part of liability includes Property Damage coverage. Can you imagine how much it might cost should you accidentally drive into the side of someone's home? You wouldn't want to be caught without property damage insurance should you need to pay for repairs to another vehicle, building or anything else you might hit. As with Bodily Injury coverage, Property Damage coverage also helps protect you in the event of a related lawsuit.
Every policy will have its limits and various degrees of coverage. It's important that you understand the basics of what you are paying for and why it is necessary. No one plans for an accident, be prepared!
Update: It's Still Ridiculously Expensive To Drive In Detroit
Nothing new here, just more evidence that's car insurance is sky high in the Motor City. According to some figures, Detroiters pay 165% more than the national average. Read more...
A Primer on Student Car Insurance Discounts
A good student discount can help lower your insurance premium and give college kids and teens an incentive to hit the books.
Insurers to demand more data via telematics to fine-tune insurance prices, says AXA CIO
AXA CIO Kevin Murray reveals how telematics devices, in-car and in-home, will increasingly help to set insurance premiums
Watch Ickey Woods bring back the Ickey Shuffle in Geico ad
Ickey Woods is back. And, more importantly, so is the Ickey Shuffle.
2 more insurance companies bank on multiple rate hikes
If your car insurance bill seems higher, just wait. Consumer investigator Jim Strickland has discovered two more big insurance companies are banking on multiple rate hikes. Strickland previously reported April and October increases for State Farm of 8 percent and 6 percent, respectively. A second open records request contained news Progessive had implemented smaller hikes last November and ...
Metromile Pitches Pay-as-You-Drive Auto Insurance
Greg Muender, a 27-year-old tech entrepreneur in San Diego, was constantly shopping for the best deal on car insurance. ?I probably switched carriers five times or more? over five years, he says. ?Insurance was a commodity to me.?
Geico punches the gas in Illinois
Geico, which last year overtook Allstate of Northbrook as the nation's second-largest auto insurer, grew auto insurance premiums by 17 percent in Illinois last year.
Insurers Keeping Drivers Happy Amid Rising Car Insurance Rates
Satisfaction with auto insurance has reached an all-time high, according to the latest J.D. Power survey.
TrueCar Now Serving Targeted Manufacturer Incentives To Customers Of Insurance Affinity Partners
SANTA MONICA, Calif., Aug. 21, 2014 /PRNewswire/ -- TrueCar, Inc. (TRUE), the negotiation-free car buying and selling platform, today announced that it has launched major enhancements to the auto buying programs for its insurance affinity partners, specifically the integration of exclusive incentives from automakers uniquely tailored to the needs of total-loss customers. Through the TrueCar ...
Study: Digital Display Ads Nine Times More Effective Than TV for Insurance Brands
The catchy jingles and memorable mascots we see on TV don?t seem to be what are attracting consumers to auto insurance companies these days. In fact, digital display ads are nine times more effective for insurance companies?especially car insurance brands?according to a study released today by Rocket Fuel . Rocket Fuel's study also found that insurance ads featuring human faces?a staple that ...