Car Insurance Coverages - What Are They?
When it comes to auto insurance, many people are easily confused by the different types of coverage available. To help you understand these coverage types better, they are listed below with definitions and explanations for your benefit.
Liability Cover - Liability coverage is the minimum auto insurance covered required by law in most states. It is intended to cover the victims of an auto accident that is deemed to have been caused by you. Your own bodily injuries or property damage is not usually covered by liability insurance.
Comprehensive Coverage - Comprehensive cover requires your auto insurance company to pay for damage to your car caused by something other than an auto accident such as fire, theft or vandalism. This sort of coverage is subject to a deductible. If you decide upon a $100 deductible, then you pay the first $100 and the company pays the rest up to the policy limit. Sometime this cover is combined with collision protection that covers you for damages sustained in a car accident.
Collision Coverage - With collision coverage, your auto insurance company pays for damage to your car if it is involved in a collision with another vehicle or with a stationery object, no matter who is at fault.
Uninsured/Underinsured Cover - Uninsured motorist cover is available for protection if you are involved in a traffic accident with a driver who is either uninsured or underinsured.
GAP Coverage - We all know that there is a sharp decline in the value of a car immediately after purchase. This means that any loan you took out to finance the purchase of the vehicle could be many thousands of dollars greater than the amount your auto insurance company would pay out if your car was stolen or became a total loss following an accident. Gap cover or loan/lease cover as it is also known is intended to bridge that gap in valuation and the amount you owe on the loan.
Personal Injury Protection (No Fault). This form of cover is only required in "no-fault" states but is optional in others and covers injuries to yourself and others in your vehicle regardless of fault.
Pay-Per-Mile - A fairly new type of coverage is Pay-Per-Mile. It is so new that it is currently available only in a few states. Basically you pay auto insurance based on the usage of your car. The less you drive, the less you pay. The downside is that in order to benefit, you have to allow your auto insurance company to put some form of tracking device in your car.
Auto insurance policies are usually a combination of coverages. For example comprehensive and collision cover are quite often combined under the title "full coverage". Whatever the terminology, it is always best to seek further advice before purchasing your policy. - 21392
Liability Cover - Liability coverage is the minimum auto insurance covered required by law in most states. It is intended to cover the victims of an auto accident that is deemed to have been caused by you. Your own bodily injuries or property damage is not usually covered by liability insurance.
Comprehensive Coverage - Comprehensive cover requires your auto insurance company to pay for damage to your car caused by something other than an auto accident such as fire, theft or vandalism. This sort of coverage is subject to a deductible. If you decide upon a $100 deductible, then you pay the first $100 and the company pays the rest up to the policy limit. Sometime this cover is combined with collision protection that covers you for damages sustained in a car accident.
Collision Coverage - With collision coverage, your auto insurance company pays for damage to your car if it is involved in a collision with another vehicle or with a stationery object, no matter who is at fault.
Uninsured/Underinsured Cover - Uninsured motorist cover is available for protection if you are involved in a traffic accident with a driver who is either uninsured or underinsured.
GAP Coverage - We all know that there is a sharp decline in the value of a car immediately after purchase. This means that any loan you took out to finance the purchase of the vehicle could be many thousands of dollars greater than the amount your auto insurance company would pay out if your car was stolen or became a total loss following an accident. Gap cover or loan/lease cover as it is also known is intended to bridge that gap in valuation and the amount you owe on the loan.
Personal Injury Protection (No Fault). This form of cover is only required in "no-fault" states but is optional in others and covers injuries to yourself and others in your vehicle regardless of fault.
Pay-Per-Mile - A fairly new type of coverage is Pay-Per-Mile. It is so new that it is currently available only in a few states. Basically you pay auto insurance based on the usage of your car. The less you drive, the less you pay. The downside is that in order to benefit, you have to allow your auto insurance company to put some form of tracking device in your car.
Auto insurance policies are usually a combination of coverages. For example comprehensive and collision cover are quite often combined under the title "full coverage". Whatever the terminology, it is always best to seek further advice before purchasing your policy. - 21392
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