Car Insurance — Clarifying Things
When you buy car insurance, you enter into a contract with the insurance company. Under the contract, if your car meets with an accident, the insurance company must pay for the losses. In exchange, you agree to pay the premium.
Car insurance provides property, liability and medical coverage. Property coverage pays for damage to or theft of your car. The liability coverage will pay for your legal responsibility for bodily injury or property damage caused by your car.
The medical coverage will pay for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.
Majority of the car insurance policies are valid for six months to a year. You must renew the policy once it expires.
The law in all states require you to have some form of car insurance if you own or operate a car.
The penalty for driving a car without insurance is different in different states. Some states impound your car. Some states impose heavy fines. You could be in serious trouble if you car is involved in an accident without insurance. You may have to comply with the financial responsibility laws including having to pay for any injuries or damages out of your own pocket.
Your credit history, the age and type of your car will play an important role in determining the rate you have to pay for car insurance.
You are responsible for providing insurance for any car you own regardless of who is operating the car. It is illegal for cars to be operated without insurance.
Finally, a few savings tips…
1. Although this may sound funny, you can bring down your rates by getting married. I know you won’t get married just for this but when you do, it will save you a bit in auto insurance. It’s commonsense that every person becomes more stable and less reckless once they get married. This stability affects such a person for good when he/she is behind wheels. Insurers will tell you that their records show that married people make fewer claims. Furthermore, when they do make those claims, they usually cost less on the average than those married by their unmarried counterparts.
2. Your rates will jump through the roof if you modify your car. Things like changing your tires to bigger ones than specified by the manufacturer, adding equipment that will increase your car’s horse-power will cost you a lot more. So if you’re really serious about keeping your rate down, leave your car the way it was manufactured.
3. Before you get carried away with the few hundreds you will save on a house, check if it will not cost you much more in auto insurance. Homes in the same neighborhood may fall under different risk zones as far as your insurer is concerned.
So check with your agent before you commit to a new home. The truth is that most people don’t think about this when they are about buying a home.
Since you may live in the same home for decades to come, a difference of $200 in auto insurance rates would amount to thousands over the years.
4. If you must quickly get something inside, turn your car off, lock up and pocket your keys. Don’t leave your car unlocked and running. The only easier thing for a thief would be if you handed over your keys as a gift. Every thief checks how easy a target is before making a move. An unlocked car with the engine running? What could be easier?
5. A good alternative for you is to use your parents’ auto insurance policy. Your parents are part of a better risk age bracket.
To take advantage of this though, you will have to live with your parents and also have the car registered in their name. This means that by law they own the vehicle. If the benefits of “independence” outweigh your car insurance savings then this is certainly not an option for you.
To get more tips click here: Discount Auto Insurance and Cheap California Auto Insurance. Chimezirim Odimba writes on financial matters.
