Car accidents literally happen almost every 18 seconds in this country. Odds are one will happen to you, so it is important and often mandatory to have car insurance. Auto insurance is specifically meant to protect you from financial loss should you be involved in an accident.
This kind of coverage is a safety measure that is designed to protect you from being responsible to pay potentially huge costs that can be associated with a car accident. Automobile insurance is basically an agreement between you and the insurance provider. Your part of the contract stipulates that you pay the monthly premiums and whatever deductible should an accident occur, while the insurance company agrees to compensate you if you suffer losses due to a car accident as determined by your policy particulars.
Generally, your car insurance policy can have a myriad of kinds of coverage details. For example, your policy often will include property damage liability. This is what covers the cost of the repair or replacement of your vehicle as result of an accident as well as the expense due to the damage to anything for which you are responsible. Most states mandate this type of coverage for drivers. Bodily injury liability is what pays for any medical costs, possible lost income, and any pain and suffering for someone injured in an accident in which you were at fault. This also covers funeral expense for an individual who dies as a result of an at-fault accident. Additionally, bodily injury liability also is provided to help cover any costs associated with court and legal costs should you require legal representation. In most states, this coverage is also mandated.
Collision coverage is what pays for the damage that your vehicle sustains due to an accident with another car. If you are determined to be not at fault, then your insurance company will attempt to obtain reimbursement from the other driver’s insurance company for any of the accident costs. Collision coverage is optional in all states but required by most lenders if you have a loan.
Comprehensive coverage is what provides protection from all the remaining potential risks that are not caused from an accident with another car. This normally includes vandalism and theft, damage from fires, storms, falling objects, earthquakes, or animal-caused collisions. This is also optional with the exception being when the driver’s car is under the terms of a loan.
Underinsured and uninsured motorist coverage is what provides coverage for the policyholder should he or she (and passengers) be involved in an accident that was caused by an uninsured (or underinsured) motorist.
The bottom line is that auto insurance is meant to protect you, your family, and your property. Accidents do happen- even to you. Be prepared in having proper coverage.