Car Insurance Tips

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What is car insurance?

Auto Insurance: Contract between Company and Car Owner

Car insurance is a contract that an auto owner enters into with a car insurance company. The car owner pays a predetermined premium to the company; in return, the car insurance company agrees to reimburse the car owner for specific financial losses related to that auto.

The reimbursement to the car owner depends on the limits agreed upon in the auto insurance policy. Shopping online for a car insurance policy can save is fast, easy, and can save money.

If I loan my auto to a friend, is he/she covered by my car insurance?

Other Drivers and Your Car's Auto Insurance Coverage

The liability coverage contained in your auto insurance policy insures you, your spouse, family members, and anyone else who uses your auto. As long as the driver of your car has your permission, he/she is covered by your car insurance.

The amount of liability coverage you select determines how much the car insurance company will pay you in the event of an accident.

What is contained in a car insurance policy?

The Components of the Auto Insurance Policy

A car insurance policy outlines the types of coverage that apply to the insured auto. A car insurance policy for a private passenger auto can contain different types of coverage:

* Liability
* Medical Payments
* Uninsured Motorist (or Underinsured Motorist)
* Comprehensive
* Collision

Most states require car owners to have a minimum amount of Liability coverage in their auto insurance policy.

Can I drive my auto without having car insurance?

State Requirements for Auto Insurance Coverage

New Hampshire and Wisconsin are the only U.S. states that do not require liability car insurance coverage; however, these states do have financial responsibility laws.

These laws require car owners to have the assets necessary to cover any claims that are their fault. If you take out a loan to pay for your auto, the loan company may require collision and comprehensive auto insurance, even if your state of residence does not. Find out what your state requires and get a car insurance quote online.

What is covered by my car insurance policy?

What is Covered by Your Car's Auto Insurance

What is covered by your car insurance policy is entirely up to you. Once you have fulfilled the minimum state requirements for liability coverage in your auto insurance policy, you can tailor the remainder of your policy to fit your specific needs.

For private passenger autos, car owners can select coverage for the car;

* Coverage against collisions;
* Coverage for damage to your car from outside sources;
* Coverage against damage from uninsured or underinsured motorists;
* Coverage for medical payments for yourself and your passengers.

Find out what your state requires and get a car insurance quote online.

Do I need to buy car insurance for my older auto?

Auto Insurance and the Older Car

Most states require car owners to have auto insurance with a minimum amount of liability coverage. This insures that victims of an auto accident will receive financial compensation for personal injury and damage to their car when the collision is caused by another driver.

If your car is older and has low market value, you may choose not to purchase comprehensive or collision coverage from your car insurance company, since the cost to repair an older car can often be more than the car's market value.

If I lease my auto, do I still have to have car insurance?

Auto Insurance and the Leased Car

Leased autos are required to have car insurance coverage. The company that is financing your lease -- either the auto dealer or your bank -- will require comprehensive insurance and collision coverage in addition to any coverage required by your state of residence.

Drivers of leased cars may also be required to have gap insurance, a cost that is often rolled into their lease payment. This insurance covers the leased car in the event of an accident that totals the vehicle. The totaled amount issued by the auto insurance company may be less than the amount the driver owes the auto dealer or bank for the auto, and gap insurance covers the difference.


Auto Insurance

In today's ever changing world it is best to have auto insurance to protect yourself as well as your family if you are ever in a car accident. In many states car insurance is even a requirement that you must have and show proof of when you purchase your vehicle tags for the year and if you are pulled over by a law enforcement officer you are required to show proof of insurance, if there is no insurance on your vehicle that you are driving you may face multiple fines, your vehicle may be impounded or you may even be taken to jail for not obeying the laws of the state that you reside in or are visiting.

You may find the best auto insurance policy for you and your family by simply visiting your local insurance company or by searching for an auto insurance comparison in your own home over the internet. By searching for a plan that suits your family you freeing up money that you could use for many other things including trips, vacations, home improvement ideas or new appliances.


Car Insurance and Rental Cars

When you shop for car insurance, check to see what kind of rental coverage you are being offered. Every car insurance company is different, and it is important to know what you are buying.
Will you be covered when you rent a car? Some car insurance companies will cover you when you rent a car at an airport or storefront location. This can save you a lot of money on your car rental--car insurance from a rental company is very pricey. While some car insurance companies offer this automatically or for a small fee, others either don't offer it or it comes with a hefty price tag, so be sure to ask about it.

The other rental car option that can be included in a car insurance policy is replacement coverage. If your personal vehicle is damaged in an accident, will the car insurance company provide you with a rental until your car is fixed? If the answer is yes, be sure to check to see how much this coverage is costing you before you select a car insurance policy. Rental car coverage is just one of many factors to consider as you purchase car insurance.


3 Tips For Getting Affordable Car Insurance

According to the Federal Consumer Information Center, there are many ways to obtain affordable car insurance. Begin your quest for affordable monthly car insurance by filling out free quote forms at major insurance websites – Geico, State Farm, Progressive, Allstate and Nationwide – or visit a cost comparison site like Esurance.

#1: Take a bigger risk!
To save money on your current monthly car insurance, ask for a higher deductible. Increasing your deductible from $200 to $500 could reduce your collision or comprehensive cost by 15 to 30 percent. Also, consider dropping collision on older vehicles.

#2: Bundle it up!
Get affordable car insurance by purchasing homeowners, life and monthly car insurance from the same provider. If you’re married, add your spouse to the same policy. Ask about group insurance and discounts through employers, professional groups, alumni organizations or other associations you belong to.

#3: Look for secret discounts!
Affordable car insurance is possible if: You drive less than 10,000 miles per year; your driving record for the past three years is flawless; you’re willing to take a defensive driving course; you have a young driver on your policy that has completed a training course or gets good grades; your car is outfitted with an anti-theft device, air bags, anti-lock brakes or daytime running lights.

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Guru Spotlight
Joe Wallace