The 7 Types of Auto Insurance Coverage

The 7 Types of Auto Insurance Coverage

If you have ever been in an auto accident, then chances are you have a greater appreciation of your auto insurance and provider. Yes, auto insurance can be expensive, but so is the alternative. However, as the cost of living continues to rise, perhaps you are considering lowering the amount you spend on auto insurance coverage. While this is a plausible budget solution, be sure that you have made sure your auto insurance coverage includes the basic forms of protection. There are 7 types of auto insurance coverage that you should have. To help you determine if you have the insurance coverage you need, here is a basic description of each type.

Types of Auto Insurance Coverage

•    Property Damage Liability– This type of insurance coverage protects you if your vehicle causes damage to someone else’s property. Although this is most often their vehicle, it also covers structures, landscaping elements or other property.

•    Bodily Injury Liability – This policy covers other people’s death or bodily injury for which you are responsible. In addition, it can be used to provide legal defense if another party involved in the accident take you to court. Claims that pertain to bodily injury lawsuits include medical bills, loss of income and pain and suffering of the other involved party, not you personally. Liability insurance coverage is required in most states.

•    Collision Coverage – This type of insurance coverage is for vehicular damage caused when your automobile hits, or is hit by, another vehicle or object. It pays to repair your vehicle, less the amount of the deductible you choose. This form of auto insurance coverage is not necessarily required, except in cases where the vehicle is rented or leased.

•    Underinsured Motorist Bodily Injury – If the person who hits your vehicle has insufficient insurance coverage to provide for injuries, death or damages to your family and passengers, this insurance policy makes up the difference, up to a pre-set amount.

•    Comprehensive Insurance Coverage – This policy protects your vehicle(s) and occasionally those of someone else (scenario depending) in situations other than a collision. Examples of this are damage caused by flood, fire, animals or theft. While it is not required to have collision insurance, if you rent or lease a vehicle, most of these companies will require it.

•    Uninsured Motorist Bodily Injury – When you are not at fault for the accident, but the offender has insufficient auto insurance coverage this policy will cover members of your household and passengers for injuries, damages or death caused by the other driver’s negligence. This is also used in scenarios where the other driver has no insurance.

•    Uninsured Motorist Property Damage – This policy is applied in situations where the offender caused property damage and has none/minimal insurance coverage. It typically pays up to a specific amount (varies by state) based on the policy.

Having sufficient insurance coverage is simply part of being a good driver. Yes, it is an expense but it is not something that you can afford to skimp on. If you are shopping for new auto insurance, do your homework carefully so that you have all the auto insurance coverage you need.

Finance your auto rather than paying in cash

As recession has hit the global market, people have got their earning slashed down. Hence, in such a situation it becomes really difficult for you to buy a car with cash and have to take out an auto loan to purchase it. However, since car is a depreciating asset, many car buyers avoid financing vehicles and pay comparatively more for them. Thus, even if you have sufficient funds, it will be preferable for you get an auto loan. You should use the money to purchase a suitable auto insurance policy to protect your new car from mishaps.

4 Benefits of financing a car

Read on to know how getting an auto loan better than paying cash to purchase a vehicle.

1. Helps you save money:

If you’re able to take out a loan at a lower rate of interest, then you’ll be able to save a good amount. By financing your vehicle, you’ll be able to use your money to make necessary investment that will help you earn a good amount of profit. If you keep the money in a bank who will offer you high rate of interest, then your fund will increase to a great extent. Thus, it will be better if you don’t tie up your money to finance a depreciating asset like a car.

2. Can make monthly loan payments affordable:

If you follow a budget to maintain your monthly expenses or you don’t have enough funds to purchase a car, then securing a car loan can be apt for you. When you’ll search online to get a suitable a car loan, you’ll find that there are many lenders who are eager to give you the loan. Before you purchase one, you must compare the terms and conditions of the various loans available. This will help you get a car loan at a low rate of interest and you may get the opportunity to make little or no down payment to get the loan. This will help you make your monthly payments affordable and you’ll be able to build up a cash reserve.

3. Get a tax advantage:

If you’re willing to use your car for business purpose, then the IRS (Internal Revenue Service) will allow a tax deduction on the expense of your vehicle. If the IRS of your state allows you to get a tax deduction on the interest, then you will be able to get a reduction in your loan amount.

4. Get a no mileage restriction:

If you finance a car then you’ll be able to get a no mileage restriction. This will help you to drive your new car to unlimited distance if you make on time monthly payments of your loan.

Lastly, when you’ll buy a vehicle, you must focus on the type of vehicle you’re purchasing. It’s because, the cost of auto insurance policy premiums depends on the type of vehicle. Thus, try to buy a vehicle that will help you make the monthly premiums of your auto insurance policy affordable for you.

6 Ways to Save Money on Auto Insurance Quotes

Everywhere one goes; it seems people are talking about ways to save money. From couponing to bundling of services, many consumers are doing whatever they can to stretch their paycheck as far as possible. However, one easy way is by changing your Car Insurance provider.

You have likely heard much about this option. From radio to television, magazines and the Web, Insurance companies are vying for your business. One auto insurance provider may offer vanishing deductibles while another company promises to save you 15%, some Insurance companies even offer better rates when you bundle your insured items.

However, if you are planning on purchasing more or swapping Insurance providers, there are some great ways to save money on your auto insurance that you may not be aware of. Here are 6 ways to do just that:

Save Money on Car Insurance

-When you speak to a potential Insurance provider, be upfront about your driving history-especially, if it is one to be to brag about. For instance: What is your accident history? Do you have any points on your license? Are you a responsible driver? If you have a great record, let the Car Insurance company know, as this will save you money.

-What is your deductible? Lower deductibles equal higher auto insurance costs. By raising your deductible from $200 to $500, you can lower Car Insurance costs by as much as 30%; raising your deductible to $1,000 can save you 40% or more. However, do keep in mind, that if you set your auto deductible higher you need to set the money aside in the event that you need to get repair work done.

 



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-Do you have an older vehicle? If your car is worth less than 10 times the premium, save on your auto insurance by lowering or totally dropping the collision or comprehensive Insurance. Of course, you will want to have money in reserve for a new(er) vehicle if this is your only means of transportation.

-What type of safety features does your vehicle have? Auto Insurance companies typically offer lower rates on vehicles that have safety features like anti-theft devices, air bags and anti-lock brakes.

-Ask about available Insurance discounts. There is no shame in asking about auto insurance discounts when you contact the Insurance companies. Some of these discounts are being an AAA member, taking a defensive driving class or even “little” things like paperless billing or e-signatures that help Auto Insurance companies save on billing costs.

-Pay upfront. Many auto insurance providers offer lower rates if you pay quarterly, every 6 months or yearly.

Saving money on your auto insurance is a simple way to stretch your budget. With just a little bit of time invested in finding the best auto insurance company for your needs, you can soon have some breathing space in your monthly expenses. For more information on getting the most from your auto insurance, be sure to check out the other pages of our site-you’ll be glad you did!

No-Fault Auto Insurance: The Good, the Bad and the Ugly

Horns blaring, tires skidding, brakes screeching, followed by a thud and crash…no, there is nothing quite like being in an auto accident-except, perhaps, dealing with the auto insurance providers in the aftermath.  This may be because determining which driver is responsible, how much financial reimbursement is due from auto insurance providers and expectations of the involved parties can cause as much pain as the accident itself. Consequently, 22 of 50 states have opted for no fault auto insurance-a.k.a. personal injury protection (PIP). The premise of no fault auto insurance is that costs are lower since each person pays, regardless of who is at fault. States that have no fault auto insurance are:

 


  • Arkansas
  • Delaware
  • Florida
  • Hawaii
  • Kansas
  • Kentucky
  • Maryland
  • Massachusetts
  • Michigan
  • Minnesota
  • New Jersey
  • New York
  • North Dakota
  • Oregon
  • Pennsylvania
  • South Dakota
  • Texas
  • Utah
  • Virginia
  • Washington
  • Wisconsin
  • District of Columbia

 

Advantages of No Fault Auto Insurance

No fault auto insurance does have its advantages. In fact, there are several more pros than cons in no fault auto insurance over fault insurance. These no fault auto insurance advantages are:

  1. With no fault auto insurance, you are guaranteed to receive money and that you will receive it more quickly since you deal with your own auto insurance provider.
  2. No fault auto insurance means you have a lower medical expense deductible, so your medical bills are paid faster.
  3. Your lost wages are covered. This amount varies from state to state for those with no fault auto insurance.
  4. With no fault auto insurance, you do not need to prove who was at fault for the accident; nor can you be sued if you are the guilty party.
  5. In most cases, there are no auto insurance claim forms to fill out –unless you need to seek additional money.
  6. You do not need to hire a personal injury lawyer with no fault car insurance.
  7. With no fault auto insurance, your property damage is not covered and you will not receive anything for it unless you file a claim. This can be  a tedious, time consuming and ultimately costly process.
  8. No fault car insurance sets a specific amount of what will be spent on medical bills. If your costs exceed the amount set by your no fault auto insurance provider/state, then you may file a claim.
  9. No fault auto insurance does not compensate for any pain and suffering due to the auto accident. Rather, you must file an injury threshold claim (big surprise-another tiresome claim form!) However, this is extremely subjective, with each state having its own standard of what is considered extreme pain.

Disadvantages of No Fault Car Insurance

Succinctly put, no fault car insurance may lack when it comes to providing you with what is needed, precisely when you need it most.

While no fault auto insurance does have its advantages, there are also reasons that it is not the ideal solution. So if you are considering a move to a state where no fault auto insurance is the norm, be sure to keep this information in mind as you consider your budgeting needs.

 

 

 

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Why Car insurance?

Car insurance technically provides protection against the losses incurred as a result of unavoidable instances. It helps cover against theft, financial loss caused by accidents and any subsequent liabilities. The cover level of Car insurance can be the insured party, the insured vehicle, third parties (car and people). The premium of the insurance is dependent on certain parameters like gender, age, vehicle classification, etc. Car insurance gives confidence to drive fearlessly but at the same time should follow the traffic rules. In emergencies it acts like a boon to the insurer.

With so many car insurance companies vying for customer base in the market, it is quite difficult to make a decision like choosing the right policy covering the requirement, right insurer, etc. Figuring out the right insurance policy fulfilling the requirement and being cost effective can be time consuming. PolicyBazaar assists in this endeavor of finding the right car insurance for the users. Fill in an online form, mention the car details, specific requirements and our experts will take it forward. We bring the most competitive cost quote and benefits of all insurance companies under one roof helping decision making. Our reports suggest customers saving upto 40% the premium by comparing, while getting the most suitable policy.

Welcome to our site on car insurance

Having adequate Car insurance is a vital not only for peace of mind but for financial well being. If you are in a serious car accident, you could be liable for thousands of dollars if not more. Automobile insurance is also a popular topic in United States as on average there are 2.5 cars per family. This translates to millions of cars that are on the road every day. In order to be a better educated consumer about car insurance, you need to do your due diligence and research the topic of insurance. We have made this easier for you but putting together a wealth of information regarding car insurance on this website. If you are unable to find what you are looking for, feel free to contact us at your convenience and we will try to help you out. Please note that we are not an Insurance company or a provider of Car Insurance Products. We are an independent entity and are here to provide unbiased opinion about insurance topics to you the consumer. If you have any other questions feel free to contact us via e-mail at