What is Auto Insurance?
Driving on the road comes with a many hazards, so auto insurance is there to provide some financial stability and peace of mind to drivers. This financial package is devised to cover expenses that would otherwise be nearly impossible for ordinary individuals to pay within a short period of time.
Who it is for
A person who holds a valid driver’s license in a state is required to purchase minimum coverage for automobile insurance. This type of insurance covers all types of passengers vehicles including sedans, crossover SUVs, minivans and pickup trucks. As mandated by a local department of motor vehicles, the Gross Vehicle Weight Rating must be under a certain number in order for a vehicle to qualify for coverage.
How it works
Automobile insurance usually lasts for short terms such as six months or one year. The coverage must be renewed annually or bi-annually. Monthly installments can be paid or one single payment may be made to take care of the outstanding balance. A policy holder can file a claim whenever he or she believes there’s a legitimate need to receive money for repairs due to accidents and other incidents that are partially or fully covered.
Different types of coverage in existence
The most important type of automobile insurance policy is known as liability. This specific plan is used to pay for expenses that are related to bodily injuries of drivers and passengers. Liability insurance may also pay for any property damage that a policy holder is responsible for. Collision insurance is specifically dedicated to covering repair fees for damage that results from an impact with other motor vehicles. Comprehensive insurance covers a broad range of damage that does not involve any other cars or motorists.
Drivers who buy automobile insurance save a lot of money on expensive repairs that have to be done after an accident or other incident like severe weather. A deductible on this policy essentially limits the amount of out-of-pocket fees that a person has to pay when a claim is filed. Car owners could also receive full compensation and reimbursement for a total loss of their vehicles.