Most frequently asked Auto Insurance Questions

What is auto insurance? It’s a contract between you and the insurance company, which basically acts as a guarantee that in the event your car is stolen or damaged/destroyed by an accident you will be protected financially. You could get injured and need financial support and this too can be covered in an auto insurance policy. For this protection, you pay a fixed amount of cash as a premium every month to the company. All specific details are outlined in the contract about what is to be insured and what will not be insured and is finalized after a mutual agreement.

But besides understanding what auto insurance is, there are other pressing questions that are asked quite frequently. This article will deal with those questions. First, let this part of the article start with the most important question:

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How much does an insurance policy cost?

Insurances deal with rates. These rates depend on certain factors that are mostly about you. These factors will determine the cost of the insurance policy. What is the cost of an auto insurance policy? The following lines of questioning must be answered by a policy buyer to get to the cost. And the cost for a particular policy can vary from case to case.

The six lines of questioning done by auto insurance companies that determines the cost of the policy

  1. Personal detail will be considered like what’s your age, what’s your gender and are you married or not?
  2. Where are you residing? Are you on rent or do you own your house?
  3. How much driving do you do? Is it mostly job related? Is it done for personal reasons? How many miles do you usually drive in a year?
  4. What are the particulars of your car?
  5. What is your credit score? How have you handled your previous payments on loans and installments? How are you managing your current payments?
  6. What type of coverage are you asking for?

The rate of payment and the kind of coverage will depend on how you answer the above lines of questions. Remember, every company has a different policy. Some could give you a good quote, that is, a reasonable amount will be asked for as a premium per month for the coverage offered. Others might ask a heavy monthly payment that might be too much for your budget.

Most frequent questions asked about auto insurance

The following questions are asked a lot. Take notes, if any of them are what you want to know about too. And do consider them as well.

Is it mandatory to insure your car?

It is mandatory for most of the drivers. Most states will require some degree of insurance. The most minimum coverage could be having a liability insurance coverage or a more upgraded medical insurance package or an uninsured/underinsured motorist insurance policy.

The state of New Hampshire and the state of Virginia do not demand drivers getting auto insurances, but these states do have minimum level requirements when drivers opt for getting life insurance coverages.

When to get your car insured?

Before you even start driving, you should get some kind of auto insurance, usually the minimum according to the laws of the state you are residing in. And as it has been pointed out, it’s the law in most states, except that, each state may differ to what type of insurance a driver must have. It is for your own protection as you can get exposed to extreme financial problems if an accident does occur.

Do car insurance companies give discounts?

Insurance companies do give discounts if certain criteria are met. Depending on the insurance company’s policies, discounts can be availed if you are a student, a very good driver, have no accident record or own a hybrid vehicle. A combination of these criteria might make you eligible for a better discount, all depending on the company’s policies.

Furthermore, if a person already holds a number of insurance policies from an insurance company and wants an auto insurance policy too; the policyholder might get a good discount.

Where to go for auto insurance coverage?

You can visit a national or a local insurance company in your state that will offer you many kinds of insurance coverages for your car. You can also get your car insured from any car insurance dealing agent or from any broker who offers auto insurance policies from an insurance company.

What is covered by a car insurance?

Depending on what type of insurance policy you have taken, it can be any number of coverages stated below:

  • Your insurance could cover for bodily injuries, property destroyed or liability coverage (which is injury done to other people and damages done to other people’s property/properties by you while driving.)
  • Your insurance could only be dealing with a comprehensive coverage, that is, any type of damage done to your car will be repaired or replaced; if the damage is due to a fire, hail storm or vandalism. This coverage will also deal with your car getting stolen. In this case, you will be fully reimbursed or whatever you had agreed to in the policy concerning such an event ever occurring. This policy also covers any kind of collision with animals. But it does not deal with any other kind of collision.
  • Your insurance coverage might only deal with collisions with other vehicles, property, trees lampposts or any kind of situation where your car might roll over on its top or fall off from some height, damaging or destroying your car beyond repair. This policy does not cover collisions with animals.
  • The policy might only deal with a personal injury protection coverage, which covers medical bills plus other damages incurred.
  • The auto insurance might be an uninsured or underinsured motorist protection coverage that financially protects the policyholder from the person who was at-fault in the car crash but has no liability insurance or the liability insurance is insufficient to cover all the expenses incurred by the policyholder.

Summing up on auto insurance

Be assured that these are very frequent questions asked by both – those who have vehicles and by those who are planning to buy a vehicle. This article has done its best to generally define auto insurance for everyone interested in the subject. It is hoped one of these questions and their answers have satisfied your questions.

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