RECENT POST

Thursday, February 11, 2010

Car Insurance Articles

What is Auto Insurance?

What's the value of auto insuranceAuto Insurance is a method of spreading out risk in exchange for currency.

The insured pays premium in exchange for the insurer to pay out in case of the unexpected.

How does it help us? and Why do we need it?

Having adequate coverage in case of an accident can lift a huge amount of stress, financial burden and well being. Picture these following situations:

  1. “Where did that stop sign come from? I didn’t see it. It was my fault because I didn’t stop and hit I hit that other car. Oh no! I’m not insured right now, I don’t have an active policy. Look at their damage! Where am I going to get money to fix their vehicle and pay for the ambulance that I hear coming on the way. Wow, look at MY car, It not even drivable anymore. How am I going to get around without a car?”
  1. “Oh my! I can’t believe I just ran a stop sign and hit this other car. I’m going to make sure that my auto insurance policy takes care of his vehicle’s damages as soon as possible. I feel bad for injuring him but the liability portion of my policy should take care of him. I’m sure glad I paid the extra premium to cover my car too and even get a rental car. It’s good to be insured.”

The above explains the importance of protection and why you need auto insurance at all times.

What happens if you get caught without auto insurance?

The worse part about getting caught without insurance coverage is the financial loss you take from the accident. As the first example above demonstrates, uninsured drivers may end up with personal damages and owing money for damage caused to others.

Aside from the above, each state enforces their own laws about the coverage and limits they make mandatory (financial responsibility laws). Penalties for not being insured may include hefty fines, vehicle registration suspensions, the need to keep an SR 22 for multiple years.

What do auto insurance companies base their premium on?

Car insurance companies base their premiums on a risk assessment of the insured. In other words, the possibility of a loss (risk) from automobile accidents, theft, vandalism and other perils. Based on statistics gathered from history, they charge more for those with a high risk and less with low. Rates vary within companies because each may have a unique claims experience. Some target the non standard market and other the standard or “preferred” market. Details can be learned about what factors determine rates and will further explain how the rating and pricing works.

Paperwork can be confusing at times; however, it is important to know what is an auto insurance policy declarations page so that no misunderstandings and misinterpretations occur. More help is available at the learning center provided by OnlineAutoInsurance.com.

Ready to compare rates quickly from multiple companies? Complete an easy form to get fast online car insurance quotes from leading carriers at OnlineAutoInsurance.com.

0 Comments:

Post a Comment



 

blogger templates | Make Money Online