Basic Elements of an Auto Insurance Policy

Do you know what basic auto insurance is? How to get insurance or even what the minimum auto insurance you need to carry in your state. Let me explain what auto insurance is and what policy you should look for.

Let’s Start With the Basics (Auto Insurance)

No matter what state you live in, it’s illegal not to have auto insurance. Having the basic knowledge of car insurance while being a licensed driver will keep you safe and legal on the road. Yes, different states mandate their auto insurance policies. Most auto policies are comprised of bodily injury liability, personal injury protection, property damage liability, collision, comprehensive and uninsured/underinsured motorist.

Let’s Go Shopping

What type of auto insurance should you look for? Foremost, you want to look at all companies and compare prices. Each auto insurance company has their method on how to determine prices/premiums. It’s highly unlikely that one company will be the lowest price out there, so add up what you want in your policy and try it across all companies.

Agents?

Yes, you can go into a local office affiliate and talk to someone directly. You can also call a customer service number or even process your policies online. Going to see an agent can still be time-consuming, but talking to someone in person can be beneficial to getting the right policy. Remember, they talk to and see many people daily, so don’t get attached to that insurance agent.

What Are the Policies?

Here are the basic elements of auto insurance policies:

  • Liability:  Covers bodily injury to others you may hurt when you are at fault
  • Property Damage: Pays for damage you do to another person’s property
  • Collision: Allows your car to be repaired, even if the accident is your fault
  • Comprehensive: Covers your car from theft, vandalism, hitting a deer, flood, etc..basically, “anything other than collision”
  • Personal Injury Protection (PIP): Medical coverage for you and your passengers
  • Uninsured Motorist: Protects you when you are hit by someone with no insurance to cover your injuries
  • Underinsured Motorist: Covers above and beyond for injuries to you in excess of the limits of whoever hits you

 Other coverages are available on every auto insurance policy, but these are the major coverages.

Searching for My Policy

Auto insurance is like most legal contracts you sign, so it’s important you understand what you are actually signing. They break contracts down into sections. Therefore, it’s easy to find what part of the policy you’re looking for. You should know the essential parts of your contract like you would a lease agreement. Understanding the conditions of the policy, and declaration page is essential. This will help you navigate your auto insurance policy and make it easier to read.

The Right Policy

Once you find the right policy, everything boils down to finding a company that offers what you want for a good price. However, maintaining a good driving record and staying on top of your insurance payments play a large part when referring to the price you might pay. As long as you have your state minimum insurance requirements, and you don’t get into any accidents, you can be a stress-free licensed driver as far as staying legal on the road. No policy is written in stone once in place.  It can change as your needs as a driver change.



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