Finance

What type of Car Insurance do you really need?

Well, that would require no rocket science knowledge. If you are driving a vehicle, you need to have adequate motor insurance coverage. Speaking from the legal point of view, unless you have car insurance, you cannot drive the car at all. But, what type of car insurance do you need? Let us explore the details.

How to Get a very Cheap Car Insurance?

Understanding the exact type of car insurance you need may not be easy enough. In fact, one type of motor insurance differs considerably from one type to another. They would need to study the differences of every kind of auto insurance and arrive at a decision.

car insurance

There are basically three types of Car Insurance options. They include Liability, Collision, and Comprehensive.

Liability Insurance

This is the minimum car insurance you need to go with. This will involve covering the expenses for damages, medical expenses, and any other consequences. If an accident is caused due to any reason, you will be liable to pay the damages.

Collision Insurance

As the name should indicate, Collision insurance involves the coverage of the damages caused to the vehicle due to an accident. Irrespective of who is at fault, the collision coverage makes you pay for the damages. It can also offer you a replacement option.

Comprehensive Insurance

This is the comprehensive coverage for your car. It will cover the damages and other issues. It will also cover the theft or other natural disasters. In essence, comprehensive insurance coverage would be what would provide the best possible assurance against any sort of damage to your car.

The Liability auto insurance is a mandatory one in most of states in the US. We assume it to be the same across different countries as well. You can opt for the minimum amount of liability dependent on your vehicle or the plan offered by car insurance companies. You can either opt for Bodily Injury liability or Property damage liability. The former covers the damage caused by accident to another person, while the latter covers the damage to the properties of another person. A combination of property damage liability and bodily injury liability would be a great option.

The Comprehensive motor insurance, on the other hand, comes with a complete protection. It does cover a wide range of scenarios that include riots, natural calamities, theft, hails, or even vandalism of any sort. It can also help replace your vehicle. However, if you are checking out a very cheap car insurance, it may not be the right one to go with. The Comprehensive Car Insurance comes with a deductible.

A few Car Insurance terms you need to understand

If you want to understand the concept of car insurance better enough, it may be essential to understand a few select terms to make you well versed in what you are getting. In fact, that way you would be able to understand what your auto insurance agency is trying to sell you. That would perhaps also improve your financial confidence as it lets you plan your expenditures well ahead of time.

Deductible

You will need to pay a percentage of the damages before you can be paid the insurance amount. This amount is called the deductible. They are applicable per claim. This is done to discourage people from posing fake claims.

Coverage Limit

This is the maximum amount you will be paid for each of your coverage plans. It may be worthwhile to get in touch with the car insurance broker if you want to avail a maximum possible coverage. If you exceed the amount covered by your policy, you will need to pay the additional amount from your pocket.

Insurance Premium

It is the amount you pay each year for availing the necessary coverage. The frequency may, however, be dependent on your service provider. It can be monthly, half-yearly, or annually. The exact premium amount is calculated based on your age, the deductibles, the make and model of the car, the age of the car, and your driving history.

Multi car insurance

The name itself should be self-explanatory. If you have more than one vehicle, you can check out the options for obtaining multi car insurance. It would be more practical than opting for car insurance for individual cars.

No fault and Fault insurance

No fault insurance would mean your insurance company will pay for damages irrespective of whether anyone is at fault. For instance, if you suffered an accident because of the negligence of another driver, your insurance company will pay you for the damages even when the fault lies with the other driver. It may be necessary to check the list no fault insurance states before signing up for a service.

Currently, we have these twelve no fault states – Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania and Utah.

Is Multi car insurance a good alternative?

If you own a fleet of cars, opting for multi car insurance would be a good option. You will find it a money saver when compared to the single car insurance options. Car insurance companies offer you discounts if you are opting for multiple insurance quotes.

motor insurance

 

Just like bulk buying saves you money, multi car insurance quotes help you save enough money. Ideally, the best multi car insurance will cover five cars at the maximum. Compare multi car insurance options from different service providers. It may be noticed that some service providers will need the vehicles registered on a single address. Some of them, however, let you opt for adding the vehicles of your immediate family even if they live elsewhere.

However, it may be wiser enough to give a thought to a few factors before opting for a particular multi car insurance. It would be practical to check a few factors before taking a call. A multi car policy may or may not always be a money saver. The insurance quotes depend on the age of the driver and the age of the car. The younger and inexperienced driver will not get a cheaper option when compared to the experienced driver who has a good driving history.

Compare all possible options and arrive at the right ones for your needs. It may be worthwhile to review all possible alternatives before opting for one plan that best meets your needs. However, while you are at looking for the cheap insurance, make sure that you are looking at the value provided by the insurance company.

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