There are many options for insuring your automobile. These include protecting the owner and others from potential calamities if it is involved in an accident, or damaged or destroyed by another peril. This article will discuss the most popular types of automobile insurance and help people decide which one to buy.
A standard bodily injury policy and property damage liability policy is the most basic automobile plan. This policy is required by all states in order to legally drive on public roads. These plans are generally used to insure low cost vehicles owned by individuals with limited assets. If they are involved in an accident, they will cover the cost of injuries to one or more persons and damage to other people’s properties up to the policy limits. People with more assets are advised to opt for higher policy limits than the minimums required by law. However, those with fewer assets may find it easier to keep the law’s minimum limit and file for bankruptcy if they are subject to an unreasonable legal judgment.
Full coverage insurance plans provide comprehensive and collision insurance protection, which is more than what the state requires. These insurance plans are primarily designed to protect collateral that was used to finance new or used vehicles. These policies are also beneficial to those who own expensive vehicles, which would be very costly to replace or repair if they were involved in an accident.
Collision policies cover the cost of collisions with other automobiles and objects, minus any deductibles for damage caused by an accident. Comprehensive plans cover the cost of any other damages or losses such as vehicle theft or theft by a criminal.
Uninsured or underinsured motorist policies are another common type of auto insurance. These plans protect vehicle owners from the potential cost of an accident in which another driver is at fault, but have too little or no insurance coverage to cover the costs of the victim’s property repair or replacement or medical expenses. The offending motorist can often file for bankruptcy, or leave the country to avoid paying victims. Uninsured or underinsured plans may be able to pay these costs, rather than making things worse for accident victims. These plans are generally affordable and can be beneficial to almost anyone.
Some types of vehicle insurance are more useful than others. If you have a credit card that offers rental car insurance, rental car plans do not need to be purchased. For people who travel frequently and don’t have the necessary knowledge to change a flat tire on the roadside, roadside assistance or towing coverages may be helpful. If they have the skills and contacts to provide this assistance, it is usually not worth the expense.
To determine which types of basic car insurance are required, one must assess personal assets and whether a vehicle is financed. It also needs to be assessed if there is the possibility of requiring roadside assistance or being in an accident with an underinsured or uninsured driver. There is more chance of mishaps happening in some areas than others. It is worth looking into insurance plans that can help you manage this risk.