What is auto insurance?
Auto insurance protects you
against financial loss if you have an
accident. It is a contract between you
and the insurance company. You agree to
pay the premium and the insurance
company agrees to pay your losses as
defined in your policy.
Auto insurance provides property,
liability and medical coverage:
-
Property coverage
pays for damage to or theft of your
car.
-
Liability coverage
pays for your legal responsibility
to others for bodily injury or
property damage.
-
Medical coverage
pays for the cost of treating
injuries, rehabilitation and
sometimes lost wages and funeral
expenses.
An auto insurance policy is comprised
of six different kinds of coverage. Most
states require you to buy some, but not
all, of these coverages. If you're
financing a car, your lender may also
have requirements.
Most auto policies are for six months or
a year. Your insurance company should
notify you by mail when it's time to
renew the policy and to pay your
premium.
Why do you need auto insurance?
It's really all about protecting
yourself financially.
-
If you're in an
accident or your car is stolen, it
costs money, often a lot of money,
to fix or replace it.
-
If you or any
passengers are injured in an
accident, medical costs can be
extremely expensive.
-
If you or your car
is responsible for damage or injury
to others, you may be sued for much
more than you're worth.
-
Not only is having
insurance a prudent financial
decision, many states require you to
have at least some coverage.
Questions to ask your agent
Your Independent Agent is an advocate
for finding auto insurance that meets
your specific needs. Here are a few
things to consider as you prepare for
the discussion:
-
How much can you
afford to pay if you get in an
accident? (To keep premiums low you
may want to have a higher deductible
and be willing to pay more for
repairs.)
-
What is the
insurance company's level of service
and ability to pay claims?
-
What discounts are
available? (Ask about good driver,
multiple policy and student
discounts.)
-
What's the procedure
for filing and settling a claim?
(Ask who to call and what happens
after you file a claim.)
