Automobile insurance, also known as car insurance, auto insurance or motor insurance, has become as much a way of life as high gasoline prices and the importance of oil changes, for drivers across the globe. In the United States each state is responsible for defining and enforcing the auto insurance regulations of that state. Each state also has different penalties for driving without auto insurance ranging from heavy fines to jail time. None-the-less approximately 15 percent of the accidents in the US to date is caused by uninsured drivers.
An automobile accident can cause a large array of damages. Simple 'fender bender' accidents may cause only slight vehicular damage. Whereas, more serious accidents can be fatal as well as cause thousands of dollars worth of damage. Many Americans do not like to pay their insurance premiums but without auto insurance lives can be ruined after a serious accident. Having liability coverage is better than no coverage in the eyes of the law but many drivers venture the roads uninsured and create financial issues for all drivers.
Automobile insurance is also known as car insurance
Due to the financial severity of accidents involving uninsured drivers some states have actually made it a law to have auto insurance that covers damages and medical expenses generated in an auto accident with an uninsured motorist. This type of insurance is required in Connecticut, DC, Illinois, Kansas, Maine, Massachusetts, Minnesota, Missouri, New Hampshire, New Jersey, New York, North Dakota, Oregon, Rhode Island, South Carolina, South Dakota, Vermont, Virginia, West Virginia and Wisconsin. This usually covers any medical expenses or financial losses associated with the accident including car damage.
Car insurance protects drivers to varying degrees depending on their policy. Coverage ranges from liability to full coverage. Liability coverage, the minimum allowed by most states, insures that any person that the policy holder injures during an accident is covered as well as their property. This means that the insurance company will pay off the costs of claims made against the policy holder including all monetary damages. This insurance generally costs the least amount and will be a saving grace if you ever cause an accident. But these policies rarely cover the damages done to the policy holder's vehicles in the event of a collision that is deemed their fault. If the policy holder incurs medical expenses or major vehicular damage liability is not likely to cover the tab.
Other types of auto insurance include Personal Injury Protection and Medical Payments. These are examples of policies that will pay your medical expenses, lost work wages and expenses associated with an accident. Some states actually have mandatory laws requiring this type of auto insurance including Colorado, Delaware, Florida, Hawaii, Kansas, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon and Utah. Full Coverage Insurance, which is generally required for newly financed and leased vehicles, will cover all of the costs associated with an accident including the policy holder's property damage.
The price of an insurance policy is dependant on many factors. The cost and 'crashworthiness' or crash test rating of a vehicle are studied to determine how well each make and model of vehicle would withstand different types of collisions. These results are then used by auto insurance companies to evaluate their possible risk if that vehicle is in an accident. Although a vehicle's make and model greatly influences the price of an individual policy the safety performance of the driver is also a factor. Behavioral risks such as drinking and driving, not wearing a seatbelt, speeding and failure to obey traffic signs are examples of things that can causer an insurance rate to go up. Other factors include gender, age and previous driving record.
Automobile insurance is no simple matter. According to the Insurance Information Institute, a New York based resource dedicated to improving peoples understanding of insurance, 42,642 people were killed in an auto accident in 2006 and another 2,575,000 were seriously injured. This means big bucks for the insurance companies and they need to know how much of a risk each policy holder poses to their company. A majority of insurance providers offer discounts to policy holders who engage in safe driving practices. In some states there are course for motorists over the age of 55 to improve driving skills and some insurance agencies offer discounts for drivers under 25 who complete a similar safe driving program. As environmental concerns mount insurance agencies are even offering insurance discounts to owners of 'hybrid' cars, which combine a battery-powered engine with a traditional gas engine. These are just a few of the incentives auto insurance companies offer clients as part of an initiative for safer and better driving conditions.
In the US there are more than 50 different auto insurance companies. If you type auto insurance in almost any search engine you will receive more than 32 million results. So how do you find the auto insurance best for your needs? Just like finding the right option for a car, shop around. Shopping around for automobile insurance requires that you get quotes from several different companies. You can compare the prices and deals before purchasing a policy. Last but certainly not least before you begin to compare prices it is essential to know what kind of coverage you need. Sit down with a prospective agent and explain your situation. A good agent will help you find the best policy for your needs.
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