It goes without saying we all need vehicle insurance to drive motor vehicles on the road. Without an insurance cover, it can be risky to be on the road and the charges in case of an accident or damage to the vehicle can run into a lot of money to be spent on getting treated or repairing the vehicle.
Car insurance is a contract that you have with a car insurance company to protect you from any loss incurred in case of an accident or a theft. In exchange for the protection, you pay a premium to the insurance company annually wherein the insurance company takes care of the losses by paying for them as per the contract.
How Does it Help Having Basic Car Insurance?
To have car insurance is mandatory if you own one because the insurance policy will protect you in many ways which can be beneficial to you in terms of the money spent on the vehicle. The cost of taking care of your injuries, rehabilitation, and funeral expenses will be taken care of by the insurance company. The car insurance also covers the liability, the responsibility you will have towards the property damage of others and their injuries.
Each company has its own insurance policy that varies and what you get depends on the premium you have paid for. The insurance will also cover all the family members mentioned on your policy and the premium covers even if someone else is driving your vehicle with your consent.
Let us discuss some of the typical auto insurance policies that come with a car insurance premium which can be looked at as financial protection for you while owning a vehicle. Your policy should not only cover the damages you cause the other vehicle but also your vehicle so that in case of an accident you do not incur a lot of expenses on the repair of your vehicle.
Basic Car Insurance Policy and What It Can Cover?
The basic coverage in car insurance is Personal Liability Insurance, the word itself gives you the answer, that is you are protected in case of an accident where someone else is injured or if you damage their property or vehicle. Your premium decides the basic coverage of the body injury liability limit and the property damage liability.
There is also Personal Injury Protection which is different from the medical expenses because it pays for the expenses like loss of income and rehabilitation that occurs after an injury. That explains the need to have a car insurance policy and why it is important to have one.
There are other types of additional coverages you can go for on your car insurance policy that is not compulsory but will be helpful and will save you from a huge monetary loss in case of an accident.
- Roadside Assistance Coverage can be a good one to have, especially when there is a breakdown on the road, and you need help to tow the vehicle and reach it to the nearest service station. This is where having insurance will prove handy as the insurance company will step in to give all assistance.
- Collision Coverage as the name suggests covers the expenses incurred in case of an accident caused by you. It can be you hit a wall, an animal, a person, or another vehicle but if you have the collision coverage it will cover the cost and the replacement if there is going to be any.
- There is also the Comprehensive Coverage that covers any kind of damage like theft, broken windshield, and natural calamities. It covers the damage caused even without an accident. A good comprehensive insurance policy covers a lot of options like damages caused due to natural disasters and manmade calamities, vehicle collisions, damages caused due to your fault, and damages caused to the third party.
A few things are excluded in the Comprehensive Coverage, if your car is old and your car is hit by an unlicensed driver it would not be covered in the Comprehensive Coverage. A breakdown of the mechanical of electric parts, the usual wear and tear that comes with time, damages that might occur in case of a war or a nuclear attack, and damage caused if the driver is under the influence of drugs and alcohol.
- An Uninsured Motorist Protection works well in circumstances where the third party’s insurance coverage does not meet the needs. If you are hit by an uninsured driver, then this coverage will help to pay for the damages and injuries caused to you and the vehicle by the uninsured driver. This coverage is not high in terms of cost, but it is beneficial to the vehicle owner.
Repairing a vehicle and replacing a part is equally expensive hence it would be better to have an insurance policy so that it gives you the required support in case of a breakdown, accident, or damage.
- Third-Party Insurance Policy: This covers death and bodily injury, and this policy is affordable to many vehicle owners. Though it does not cover vehicle damage, it is suitable if you have an old vehicle at home. It covers property damage that occurs during an accident and fulfills the legal obligation.
All vehicle owners should make sure that they have a good car insurance policy that gives them various options to choose from. You can check from various insurance companies, analyze their policies, compare them with the other policies and go for the one that suits you the best. You can take into consideration the make of the car, the year it was bought, the model, and how frequently you use it while going for the car insurance policy. Choose from the Third-Party Insurance Policy and Comprehensive Coverage, whichever is beneficial to you. We hope this post has given you basic information on car insurance, its advantages, and why it is imperative to have a premium policy if you are a vehicle owner.