Car Insurance Frequently Asked Questions

If you own a car, you should know that going without car insurance is not an option at all. Therefore, basic understanding about this topic is very important. Here are the answers for some frequently asked car insurance questions.

1. Why there is a need for me to have auto insurance?

Auto insurance is important because

a) Every state requires drivers to have some type of auto insurance in order to drive.

b) If you involve in an accident, it protects you from financial and legal obligation. Your auto insurance may offer coverage on expenses involved by the other party or both involved in the accident depending on circumstances, coverage and the insurance system of your state.

2. What type of coverage is included?

Three wide coverage is included which are to protect you from loss.

a) Property coverage-Covers payment for your car damage or theft

b) Liability coverage-Provides coverage for others against bodily injury or damage of property

c) Medical coverage-Covers the treatment cost, rehabilitation, and occasionally lost wages and funeral expenses caused by an accident

3. How to know which kinds of coverage are required by my state?

By contacting the department of insurance of your state as well as reading up on your state’s law at Insurance Information Institute which you can find comprehensive requirements listed by the states.

4. Which factors determine my rates?

They are based on the amount of risk you have, cost of conducting business by your insurer and the amount of money estimated which is needed to pay claims during the year. Factors such as age, type of your car, driving record, type of driving, location of storing and driving your car and also your credit rating will be studied.

5. Why do the rates vary so much between companies?

Due to the fact that every insurer’s has different claims history experience and cost of doing business. Therefore, it is vital to get several quotes before choosing the right one.

6. Can I do something to reduce my rates?

Of course! Here is a list which you can do but make sure you discuss with your agent beforehand:

a) Maintain a good driving record

b) Get several insurance quotes and compare the policies

c) Ask for discounts which you are eligible for such as low mileage, defensive driving, anti-theft and safety and others

d) Get safer and cheaper cars

e) Drop unnecessary coverage depending on your car’s age and condition

f) Go for group policy-you may get it through employer, auto insurance programs sponsored by association or credit union

7. Can my policy be cancelled by my company once I buy it?

Yes, under situations such as if you defaulted on your premiums or your licensed is suspended while the policy is in effect. You have a right to receive at least 30 days notice and demand unused premiums paid to be refunded, with the subtraction of cancellation cost.

8. Can other people drive my car and still be under coverage?

Yes, since the coverage attaches to your car and not just you. Anyone who drives the car with your consent should be covered. It is advisable for you to check with your insurers for further details.

9. Is there any coverage provided when the car is rented?

Yes, under your standard car insurance policy, most car insurers nowadays provide coverage for rentals. However, when you are on a trip and buy insurance from rental car counter, the rental policy supplants your car insurance policy; therefore, understand what falls under the coverage before you buy any extra coverage for short term.

10. If I have an accident, what should I do?

Obtain a copy police report, take down the insurance information of other party and contact your insurance company at once. Your agent will help you make determination on whether a claim should be filed according to the circumstances. Take photos of vehicles involved for later damages proof if you have a camera with you.

11. Will my premiums rise if I am not at fault in an accident?

If you always have excellent driving record with no accidents in the past, the chances for your premiums to rise is remote. However, if things are different, you may be assumed as a dangerous driver and your rates may be increased.

12. To what extend do speeding tickets affect my rates?

Many state laws provide against raising premiums after just a ticket though things may vary between companies. It all depends on your state laws and how severe the violation is.

13. Adding a teenager on my insurance makes my rates skyrocket! What can I do?

Natural increase in the rates is expected until your teenager is older and has more driving experience. Encourage him to drive safely, get good grades and wear seatbelt. All these little things can get you discounts besides establishing a good driving record for him which helps to control the premiums.

14. How can I protect myself since many people drive uninsured?

You can get protection you need from people who carry no insurance from uninsured motorist coverage. By having this kind of coverage, you will be reimbursed for bodily injuries, medical expenses or death from an accident caused by an uninsured driver, a stolen car’s car driver or a hit-and-run driver. However, there is no coverage for damage to your car because that is covered by collision coverage.

15. How can I select the right insurance company?

A reputable insurer with stable history and great customer satisfaction is the answer. There are independent sites which you can check out the companies’ ratings, or you can contact the department of insurance of your state which can also provide this information.

Let Insurance Centre Online take you to honest and caring insurers in your area. Shop for your insurance only once but make lots of useful contacts besides getting free insurance quotes as well!

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