Most states require it but everyone should have it regardless if it state mandated or not. Car insurance not only protects your vehicle and those inside, it can protect your assets in case of suit from a serious accident. Understanding the coverage that you carry and what it's limits are, could make it easier to comparison shop when it comes to your car insurance carrier.
Auto insurance premiums are a grouping of several different forms of coverage. The rate of this coverage is usually dependent upon what the insurance company considers to be your risk factor. Car insurance is typically higher for teens, but adults with poor credit can also face higher insurance premiums. The amount of the premium can be reduced by choosing higher deductibles, but it often pays to shop around before committing to an insurance policy. Rates can vary significantly from one carrier to another.
Liability insurance comes into effect if you (the insured) cause damage to another vehicle or personal property such as a fence, mailbox or some other structure. If you are in an accident, and you are ruled to be at fault, this is the part of your insurance that comes into effect. The amount of damage covered will depend upon the level of liability insurance that you carry with your policy. Their are often deductibles associated with this coverage and typically range anywhere from $250-$1000 dollars. If you have a free and clear title to your vehicle, liability insurance may be all that your state requires for your insurance coverage. This limited amount of coverage will not cover your vehicle repairs but will cover any damage that you may cause to others. If your vehicle is older or of a lower value, this may be the coverage that is best for you.
Comprehensive coverage is coverage for damage to your vehicle that is incurred due to no fault of your own. This damage could be caused by vandalism, hail storms, or that stray baseball at the ball field. Comprehensive coverage also has a deductible that is charged per claim and can vary depending upon the policy that you purchase.
Collision coverage is for the repair or replacement of your vehicle after an accident. The benefits of collision coverage can include a guarantee of the work as well as riders for car rental and towing services. The policy riders are typically an added expense but the costs associated with them are minimal. Depending upon the insurance company that carries your policy, their may be added benefits. Insurance companies will often guarantee the repair work that you have done to your vehicle if you go to a repair shop that they recommend. This win-win situation usually saves the insurance company money and leaves you with a quality guarantee.
Automobile insurance is a major purchase. Since costs can vary widely between insurance companies and their coverage limits, it is always a great idea to do some comparison shopping. By reading the details of your current policy, you can determine what your coverage limits are and compare the same coverage amounts with several different companies.