What is Auto insurance? Do you have any idea what it is? Purchasing a car can be a form of investment for some people and may not be for others. And it is that when we make an investment we want to protect it right? This is where auto insurance comes into the fray. In this post, we will be discussing what really auto insurance is, the various types there are, and how to get the best coverage for your car.
Auto Insurance
Now to answer the question you have been waiting on, what is car insurance or auto insurance? Auto insurance is a type of insurance policy where the insurer or the insurance company protects the vehicle of the insured which is you in the case of an accident, loss, damage, or theft. This very protection is valid upon paying a stipulated and agreed-on yearly premium as per what is outlined in your policy.
Accidents as per the name happen. It just might be that your car can be stolen, damaged by acts of nature, or even vandalized. Auto insurance will help to take off the stress and edge off. And it will also ensure that you do not have to bear the sudden financial loss and burden. This is one of the basic personal insurance that you need.
The Types of Auto Insurance
There are various types of auto insurance and here are the most common types;
- Third-party insurance
- Comprehensive insurance
- Collision insurance
Third-Party Insurance
This is a type of insurance policy that protects you from damages and losses only that is caused to a third party but not your own. This type of insurance is compulsory and it is the most basic type of auto insurance that you need for your car.
Comprehensive Insurance
This is another type of insurance policy that covers both the loss and damage to third parties and to you as well as your vehicle. Comprehensive insurance provides comprehensive coverage for death, bodily injury, accidental third-party property damages, and those that are sustained by the insured car.
Full Glass coverage as you should know is a no-deductible coverage that covers your windshield, windows, and sunroofs in the event of any damage. It however falls under comprehensive insurance.
Collision Insurance
Collision insurance helps to cover you for accidents or damages that happen to your car as a result of a said collision with another vehicle, car, or objects like a tree, pole and so many more, basically, something that is your fault.
What Auto Insurance Covers
Do you know what auto insurance covers? Well, if you don’t, here are the things that auto insurance covers;
Property Damage
This type of insurance covers the damage to your car, the car of another driver, or the damage caused to the property of others such as buildings or utility poles and fences.
Body Injury
This one covers the liability that is associated with injuries or death that is caused by you or another driver in the cause of driving.
What Auto Insurance Does Not Cover
Now that you know what car insurance covers, here are the things it does not cover;
Natural Disaster
If any type of damage occurs to your car as a result of an earthquake, flood, hurricane, or any other form of natural disaster, auto insurance does not cover it. Know this and know peace. These natural occurrences are regarded as “acts of God” and are excluded from the insurance policy.
Theft of Personal Belongings
In the event that your car was broken into and then vandalized, those said damages are covered by your car insurance. But if any of your property were stolen in the process, they will not be paid for nor covered by the insurance policy.
Carelessness
In the event that the loss to your car was due to carelessness on your part, your claim might be rejected by the insurance company. Perhaps you left your key in the car or did not lock your vehicle securely. Hence, you should ensure to have environmental awareness and practice safety caution.
Another Person’s Car
If you are driving another person’s car and had an accident with it, you cannot make a claim for that. If this is the case, the insurer will only pay for the claims that are made for the car registered under the name of the policyholder.
Auto Insurance Frequently Asked Question and Answers (FAQs)
Here are some frequently asked questions about auto insurance that may interest you;
Is Auto Insurance Coverage Mandatory
When it comes to third-party insurance coverage, this is mandatory. But you can however on the other hand opt for the comprehensive cover in order to get wider and broader protection.
What Is the Cheapest Type of Car Insurance?
Third-party insurance is the cheapest. It is also the minimum type of car insurance that you need by law in some parts of the world. Also, it offers the least protection for all types of auto cover.
What Is the Best Type of Car Insurance Coverage?
The best is comprehensive car insurance. The reason for this is that it offers full and complete protection. And if you have just bought a new car, a comprehensive policy is ideal.
Can I Have Two Car Insurance Policies
Yes, you can have two insurance policies on one car. It may be that your insurer may not feel the need to cover the same vehicle twice. But you can however get a second insurance policy from another insurance company.
