Car Insurance Basics
What is car insurance? Car insurance is essentially
insurance that covers you, your passengers, and your car in case
of an accident. Most states require that car owners carry
liability coverage in their car insurance policy. Liability
insurance covers expenses incurred for damaging another
vehicle with your own when you are at fault. This means that if
you are in a vehicular accident and your car caused the damage,
then the liability piece of your car insurance will cover the
damages according to the terms of your policy.
Your car insurance premium (cost) is made up of several
different factors. Those include your age, driving record,
gender, vehicle type, vehicle age, geographic location, number
of miles you put on your vehicle yearly, the deductibles
(collision and comprehensive), etc.
What is collision coverage? Collision coverage is the
portion of your car insurance that will pay you to repair or
replace your vehicle in the case of a covered accident. What is
comprehensive coverage? Comprehensive coverage is the
portion of your car insurance that helps pay for damages to your
vehicle that are incurred as a result of situations such as
weather, theft, and vandalism.
As with all insurance, car insurance policies carry a
deductible. The deductible amount is the portion of the
claim that you as the policy holder are responsible for paying.
For example, if you carry a $250 collision deductible and you
cause a wreck that requires $1000 worth of repairs to your
vehicle, then you will pay the first $250 and the car insurance
company will cover the remaining $750. Car insurance costs go up
as you lower your deductible. If you are willing to carry a
higher deductible, then your car insurance will be less
expensive.
Another item to keep in mind is that as your car ages and its
value declines your car insurance premium will decrease
in price. This assumes that you keep a good driving record and
do not get any tickets or get in to any accidents. Also, as you
car gets older you can reduce the amount of coverage that you
have in your car insurance policy. Many people believe there is
no need to carry anything more than liability coverage on a car
that is old and not worth much anyway. It is always up to you,
but it is definitely something to consider.
Car insurance is typically charged at a six month rate. This
allows you and the car insurance company to make adjustments a
couple times a year. You can pay the premium of your car
insurance once every six months or you can break the payments up
in to a schedule that is more suitable to you. Many people make
payments once a month. Keep in mind that car insurance companies
are willing to let you do monthly payments, but they charge a
higher rate on a month-to-month payment than they do for the six
month total. For example, your six month rate may be $600, but
if you make monthly payments, then you are charged $120 per
month.
There are several companies that offer car insurance so you have
plenty of choices. Please visit ChildInsure.com today for more
information on car insurance as well as health,
life, and home insurance. You can get a free online quote from
providers in your area with just a few clicks.
Author: Jason Barrett