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Key Aspects Of Auto Insurance Information

May 13, 2008
In most states throughout the United States auto insurance is compulsory. Some states, however, do not require an individual to buy auto insurance. For instance, the state of Virginia requires that residents pay $500 to the state annually per vehicle if they do not wish to purchase liability insurance for their vehicles.

There can be penalties you may have to pay if you do not get auto insurance. The penalties can vary from state to state but they normally include a fine of some sort, license or registration suspension and even revocation, and also you could sever jail time in some states. Normally, the lowest form of insurance required by law is third party insurance.

There are several different coverage plans to choose from when you get your vehicle insured. Liability is the lowest form of coverage. Liability is available through a split limit policy or a combined single limit policy. A combined single limit policy combines both bodily injury and property damage into one single payment. A split limit policy splits the two into different payments. Collision coverage is another one of the many types of coverage's. Collision coverage provides payments for a vehicle that needs to be repaired due to collision damage. If the vehicle is unable to be repaired then the collision coverage will provide payment of the cash value.

Coverage for a vehicle that receives damage from something other than a collision is called comprehensive coverage. Damage other than collision would be considered fire, weather, vandalism, or theft. There is also rental coverage or loss of use coverage. Rental coverage provides payment on rental expenses associated with an insured vehicle that needs repair due to a covered loss.

Formerly car insurance companies only paid for the cost of towing a vehicle if it was related to an accident covered under the insurance policy. Because of this car towing coverage or roadside assistance coverage was implemented. Car towing coverage pays for non-accident related tows.

Due to the statistic that male drivers have a higher involvement in accidents their rates are normally higher than that of a female driver's. Age is a factor that can determine the rate of car insurance also. Teenage drivers tend to have higher insurance premiums but if they have a good academic record then their insurer may give them a discount. Around the age of 25 it is common that your insurance premiums will start to decrease also.

When your car is repaired under your insurance policy you have to pay a fixed contribution known as an excess payment. Compulsory excess is when you pay the minimum excess payment that your insurer will accept for your policy. A voluntary excess is when you pay extra in the event of a claim on your policy. It is possible to get a lower premium from your insurer if you pay an extra amount through voluntary excess.

When you're deciding on insurance for your automobile it is important to remember all the things listed above. You should choose the coverage plan that you feel is right for you. If you choose to not get auto insurance then be careful because there can be consequences that follow.
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