For everyone who wishes they knew a little more about insurance, here are the 4 basic facts about auto insurance that everyone should know.
It's funny the things we know and the things we don't about Auto Insurance. Sometimes, we may have an intimate knowledge about something like gap insurance, but we don't really know what medical payments coverage is. For everyone who wishes they knew a little more about insurance, here are some of the 4 basic facts about auto insurance that everyone should know:
1. Common terms defined
One of the basic things you need to know when you're talking about insurance are terms. Here are some common terms you'll here when you're learning about auto insurance:
Deductibles: When you get into an accident, a deductible is the amount of money you've agreed to pay out of your own pocket before your insurance kicks in the rest. This number can vary from program to program, coverage to coverage
Exclusions: Situations your policy specifically omits from coverage, such as property damage or personal injury you intentionally cause (think Kathy Bates in Fried Green Tomatoes)
Costs above policy limits: Another term for cap: the upper limit of your policy's bail out.
Premium: The amount you pay the car insurance company ever month
2. You must have liability coverage
All states require you to purchase at least some amount of liability coverage. This is dictated by the state, and can include some combination of:
Bodily injury liability: Protects your assets if you are legally responsible for death or injury of another person during an accident.
Property damage liability: Pays for any damage you do to someone else's car or property, pays for court costs in the event of an accident.
3. "Optional" coverage shouldn't be optional
The truth of the matter is, with car insurance you need to spend money to save money. Some of the most useful policies are the ones that will save you the most: Collision (Pays to repair your car if it's damaged in an accident), comprehensive (pays for repairs caused by something other than an auto-accident), un/underinsured motorist (pays for damage incurred by an uninsured driver), and medical payments coverages (covers medical payments for you and your passengers)
4. Lowering your premium requires research A lot of things make up what we pay for auto insurance - some of them make sense (driving history) others of them, not so much (the model of your car). Some of these factors you can't help, but many you can. Try increasing your deductible, eliminating optional coverage you don't need, improve your credit score. One overlooked area is eliminating or reducing collision and/or comprehensive coverage if your car is old and not worth much. Also, contact your company to see if they have any discounts. You'd be surprised! And remember, no matter what, shop around. Rates vary wildly from company to company, and a good deal is a matter of digging.
How to Get Truly Comprehensive Auto Insurance
You need a lot of smaller policies to be considered "fully covered". And even then, the more important your car is to your way of life - the more you drive it, the more you rely on it - the more policies you'll need to be considered "fully covered."
How a Lien and a Lien Holder Affect Your Auto Insurance Policy
There are all sorts of complications that arise when purchasing auto insurance for yourself. The presence of a second party definitely complicates matters further. Here's what it all means and how it affects you.
Tips for Buying Auto Insurance the First Time
Buying car insurance for the first time is a scary situation. After all, you are buying a contract, and any sort of binding contract makes us nervous  and with good reason! But buying car insurance is a relatively painless procedure, and if you follow these tips, your first time buying auto insurance will be nothing to be afraid of.
