Auto Insurance 101By Chris Tolamalu
Auto insurance, as the term suggests, is insurance that you can purchase for your vehicle (cars, trucks, SUVs, motorcycles, etc.). It provides protection against losses incurred as a result of vehicle accidents. While the product seems simple, there are many different types of auto insurance policies available for purchase. Depending on the policy that you choose, your coverage levels and types will vary. Broadly speaking, these are the types of auto insurance programs on the market today:
Coverage:
• ‘Comprehensive coverage’ (Comp) – This kind of insurance insures your vehicle against the cost of purchasing a new vehicle if it is stolen or destroyed in a fire.
• ‘Collision coverage’ (Coll) – This kind of insurance insures your vehicle against the cost of repairing the vehicle following an accident or the cost of purchasing a new vehicle if it is damaged in an accident beyond economic repair.
Protection:
• Personal Injury Protection (PIP) - This insures against the cost of medical expenses and lost wages related to the use, ownership or maintenance of a motor vehicle. This insurance is mandatory in some U.S. states.
• Medical Payments (MP) - insures against the cost of medical expenses for bodily injury sustained in an accident beyond any expenses that may be covered by PIP.
• Legal liability claims against the driver or owner of the vehicle following the vehicle causing damage or injury to a third party.
While ‘Liability insurance’ covers only legal liability, ‘comprehensive insurance’ covers PIP, MP, as well as legal liability. In the United States, liability insurance covers claims against the policyholder and any other operator of the insured’s vehicle. If, however, any other operators live at the same address, they must specifically be covered on the policy. For rented vehicles, most rental car companies offer insurance to cover damage to the rental vehicle.
While comprehensive insurance covers most aspects of damage which can affect the car itself or the driver, there is one risk associated with buying a new car is not covered even by comprehensive insurance – once the car is bought, there is a sharp decline in its value. During this period (immediately after a car is bought), in which the remaining car payments exceed the value of the vehicle and thus the compensation the insurer will pay for a ‘totaled’ (destroyed, or written-off) vehicle, customers may consider purchasing ‘GAP insurance’. GAP insurance was established in the early 1980's to provide protection to consumers based on buying and market trends.
|
Chicago among least expensive cities for car insurance, study says
Chicago is among the least expensive cities for car insurance according to a new study released Thursday.
Metro Denver has sixth-least expensive car insurance in the nation
The Denver metropolitan area has the sixth cheapest car insurance in the nation, according to a report released Thursday by insuranceQuotes.
Survey: Detroit Has Most Expensive Auto Insurance Rates In Nation
In the metro Detroit area, drivers pay a whopping 165 percent more than the national average for car insurance.
Rental Car Crashes: 5 First Steps to Consider
Crashing a rental car can be a real nightmare, but you can try to prepare for the worst . Not only are there practical tips you can follow, but you should also consider the legal ramifications.
Do Self-Driving Cars Spell Doom for Auto Insurers?
The removal of fallible human drivers?and their steady premiums?could create havoc for auto insurers
Car Insurance Ontario CA: Target Up Insurance is Expanding
ONTARIO, Calif., Sept. 4, 2014 /PRNewswire-iReach/ -- Car Insurance Ontario CA - Car insurance is a necessity in California. While many may argue they do not need insurance because they are safe drivers, car insurance is not to protect them. Car insurance protects the consumer from other drivers. Those who live in Ontario, Calif., will be pleased to know that a 30 plus year veteran of the ...
When you lend your car, think about the insurance
Do you lend your car to friends, family, or even strangers who hook up with you through a car-sharing smart phone app? If you do, remember that you're also often lending those other drivers your ...
Healthcare workers are the worst drivers
Surgeons are the most likely to make an at-fault claim on their motor insurance, according to analysis of more than 11 million insurance quotes. Other healthcare professionals also rank highly when it ...
Florist forced out of business by chain of events
A local florist says she's having to close up shop, through no fault of her own
Who Pays My Medical Bills After an Accident?
If getting into an automobile accident wasn?t bad enough, you suffered injuries and received medical attention, and now you find out that even though you didn?t cause the accident, you have to pay for your own medical bills. How fair is that? Not fair at all, but unfortunately, it?s usually a reality, at least until [?]
|
