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Understanding Auto Insurance

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Sometimes it can be difficult to pick the right auto insurance for you. There are some things to think about GuyInCar952x357before you even get down to the process of choosing an auto insurance company. First, you need to understand how auto insurance works. You’ve heard about different deals with deductibles and premiums, but what does this really mean? We’re here to help you figure out the basics.

 

When purchasing a car insurance policy, there are many different things that may or may not be covered. These include:

  • Liability – covers accidental bodily injury or property damage you inflict on others.
  • Collision – pays for the damage to your vehicle if it is in an accident with another vehicle or object.
  • Comprehensive – which covers for loss r damage that did not occur in an accident, but by other causes, such as fire, wind, hail, flood, vandalism, or theft.
  • Medical Coverage – pays medical expenses you might incur because of an auto accident.
  • PIP, or Personal Injury Protection – pays medical expenses for the insured driver regardless of auto accident fault.
  • Uninsured Motorist – covers your expenses if an accident is caused by someone without insurance coverage.
  • Underinsured Motorist – pays damages in the event the driver who caused the accident doesn’t have sufficient liability insurance.
  • Rental Reimbursement – to cover your costs if you have to rent a car while your vehicle is being serviced for damages.

Most auto insurance policies will combine some form of the above types of coverage in order to offer a more comprehensive policy. You need to check the laws for your state and make sure that the policies you are interested in meet the minimum requirements of auto insurance. A plan with more coverage, though, might be your best bet, because you do not want to incur higher bills if you are in an auto accident and the coverage you choose was not extensive enough to cover the accident.

 

Once you have done research on your state laws as well as the plans available and what they cover, you need to consider your car (after all, if you drive something worth a lot over an older “junker” car it may be worth paying the extra few hundred dollars a year to get comprehensive insurance) and also your other insurance policies – some people do not realize that their health insurance or homeowners insurance might cover some expenses incurred with an auto accident. Then, consider how much money you want to spend, and see what fits in your budget – you should be able to find a car insurance plan that is right for you with all of these steps!

About the Author Don

Don Westerfeld has been active in the field of Insurance and Financial Planning since 1997. Don grew up in Indiana later moving to Lakeland Florida where he continues to reside with his wife and children. When he’s not in the office you can find him enjoying the great outdoors. He has served on several charitable business and non-profit organizations and continues to provide guidance, advice and support to local charities.

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