Auto insurance explained

What makes it necessary to have automobile insurance? The necessity has been a big debate for years now. The biggest reason is because it is the law. Another good reason is it protects your financial well being. These are the most important reasons.

Despite the debates lawmakers have many valid reasons for setting laws and minimums when it comes to auto insurance. Many states are setting very stiff penalties if you choose to disregard the auto insurance laws. Still many tend to ignore them anyways.

These people who chose to ignore the laws can pay pretty big for doing so. This is why uninsured motorist coverage has become so popular for motorist. So many people have heard the horror stories of being hit by someone without insurance.

If you choose to go uninsured and you cause an accident you will not be excused from paying all the damages you cause. Many states will suspend you license if you do not pay. Some other expenses invlolved are towing of your vehicle, impounding and fines to the court, court cost for damages.

There are basically 6 types of coverage you should know about when it comes to auto insurance. One that most states require is Bodily Injury Liability. This coverage is meant to cover any person that you cause injury to in an at fault accident. Due to the high cost of medical bills the states limits are usually not enough to cover the expenses most would incur.

If you are interested in covergae that also covers you and your passengers medical expenses you would want to purchase PIP or Personal Injury Protection. Another coverage that your state may say you must have is Property Damage Liability, which covers structure, tress, post and things like that.

If you have a collision and you are at fault and want your auto to be covered you need Collision Coverage. Collision Coverage protects your vehicle. If you are looking for something that would protect your auto if a fallen tree should crash down on it or vandals attack you need Comprehensive Coverage.

Too many people only purchase the minimum amount of coverage that the state requires and often that is not adequate coverage. So you may want to purchase under insured motorist coverage for your protection. Then the insurance company will pay what ever the other persons insurance does not if damages exceed their coverage.

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