What is a car insurance? What will an auto insurance cover?
Auto
insurance companies cover you and your passengers in the event of an
accident. But it is up to you to decide the level of cover you will get.
Will
the damages to your property be covered by the company? Will all the
passengers be covered or only your family? What if your daughter was
driving your car?
What questions should you ask your auto
insurance company when it comes to auto insurance? This article help you
choose between the various insurance policies.
Types of auto insurance
Liability insurance, or third party insurance.
This
is general the lowest form of insurance offered by an auto insurance
company. This is the basic insurance, if you are involved in an
accident, and it is proven to be your fault, the auto insurance company
will pay damages to the other party.
The cover offered by the auto
insurance company is usually set beforehand. These are the maximum
amount the auto insurance company will pay in case of accident
For
example the agent will agree on a $10000 coverage per person, (bodily
injury) and/or $40000 coverage in bodily injury and/or $10000 in
property damage per accident
You need to confirm with your auto insurance company what they will cover and what are the limits.
You
might be offered a very low premium by some auto insurance company only
to realize that your cover is minimal and unrealistic.
Collision and comprehensive coverage, comprehensive insurance and full comprehensive insurance
An
auto insurance company will also offer you a comprehensive insurance,
as the name indicates, you will be comprehensively covered.
In
simple terms it means that if you are responsible for a collision the
insurance company will pay for the repair of the vehicle.
But it
is not so simple, an auto insurance company will almost always have the
final say on what amount will be paid out, so if it is cheaper to give
you market value for the car, then they will.
You might think that
your car is worth $1000.00 but the real market value might be $500.00.
This is not an uncommon scenario. So if the repair of your car are more
than $500.00 then the auto insurance company will simply pay the book
value of the car.
You must make sure that the insurance company is
not in control of the market value of the car, normally organisations
like the AA will give an impartial market value.
As with the third
party insurance, the auto insurance company will almost certainly limit
the amount that will be paid out, but in general terms, a comprehensive
insurance will have higher limits.
Recreation Vehicle
A recreation vehicle needs its own insurance, a Recreation vehicle insurance is not the same as auto insurance.
You should not assume that because your car is comprehensively insured, so is your recreation vehicle.
Facebook Live
Subscribe to:
Posts (Atom)
