Why Purchase Car Insurance?
In answering the question posed in the above title, one will be mandated by the state in which they live to prove that they can be financially responsible for certain mishaps that can occur to other drivers should he or she be at fault. For the vast majority of people, purchasing good car insurance coverage is the best way to satisfy this requirement. Indeed, auto insurance is probably the most common of insurance plans obtained by Americans. As mentioned, all states mandate that you have a certain basic level of coverage, with each requiring their own specific necessary coverage details. When seeking good auto insurance plans, it is important to keep in mind that you are best served by purchasing the most coverage to keep you well protected while, at the same time staying within your budget parameters. Insurance providers will offer three main categories of coverage, liability, collision, and comprehensive. Car insurance plans are designed for those who drive a motor vehicle on a regular basis, both for personal or commercial and business reasons. It protects both drivers and passengers from the financial costs of accidents and pays out for damages that are the result of actions caused by either the policyholder or by other drivers, including body damage to vehicles as well as injuries that the drivers and/or passengers sustain.
Should one be involved in a car accident and it is not at fault for damage or injury, he or she then files a claim with his or her insurance company. This normally will mean that the policyholder will need to provide details of the accident, such as license and insurance company information of all involved, vehicle VINs and so on. Also, it’s helpful to document how the accident happened and, if possible, provide photographs and any witness information. If anyone is hurt, this is often when law enforcement will become involved and file a police report, which can be very helpful for all involved. In cases where both parties are uninjured, it is the responsibility of each driver to collect the information listed above and to submit it to their respective insurance companies. Once the claim is filed, the insurance company will send out an adjustor to examine the vehicle, take his or her own pictures and document it all in order to properly ascertain the level of damages. The insurance companies will follow through and usually take care of the repair or, if necessary, vehicle replacement costs.
The three main coverage categories are as follows:
• Liability: This type of protection is what helps if you are determined to be at fault for the accident. It pays out for any medical costs for both you and the other driver. It will also cover any property damage caused in the accident as well.
• Collison: This coverage compensates for vehicle damage incurred during collisions, no matter who’s at fault. Beyond the normally mandated liability coverage, lenders will also require this extended coverage if there is a loan on the covered vehicle.
• Comprehensive: With this coverage, one is, essentially, financially backed for any losses NOT resulting from collisions, such as theft, vandalism, or naturally caused damage to the car, like hailstones hitting the car and damaging the paint finish. This coverage is normally required by lending institutions too. Having the proper auto insurance coverage needed legally and to meet the requirements of a loan is obviously crucial but having extended coverage protection can also be very helpful in many circumstances a driver may experience, regardless of legal or lender requirements.