Auto Insurance

Auto insurance is a type of insurance that protects both drivers and vehicles against financial loss in the event of an accident or theft. It covers things like personal injury, property damage and car repair or replacement. It is required by law in nearly every state in the union. There are two primary types of car insurance to be concerned about. The first is liability coverage.

Liability insurance pays for personal injuries, deaths, and property damage others experience as a result of an accident you cause. For example, assume you accidentally back into a car when leaving a parking lot. Your liability insurance will pay to repair any damage done to the car you hit. The second type of insurance is known as collision coverage. This insurance pays to repair or replace your car after an accident. Where liability insurance is required by most states, collision is optional. However, keep in mind that banks require customers to carry collision insurance as a condition of getting a car loan.

You benefit from a good policy by always knowing you have some measure of financial protection in the event of an accident. With car insurance in place, you won’t have to worry about coming up with the cash to replace the car you just purchased should it ever be totaled. In the event someone else hits you, their liability insurance will help pay for your medical care above and beyond what your own health insurance covers.

There are very good reasons most states require drivers to carry auto insurance. Despite it being an extra expense one has to cover out of the family budget, it is an expense well worth paying for should there ever be a time when you end up needing it. Drivers can focus on healing, and fixing their vehicles without worrying relentlessly about the financial hardship that can result from these types of accidents.