In most states, auto insurance is required by law for every motorist. With millions of drivers on the road, accidents can happen to anyone. And few people have enough savings in the bank to cover the potential costs of such an accident. These costs don’t just include the repair or replacement of your car. They may also include the other vehicles involved and the people in them.
Every component of your car insurance policy is there to protect you financially. To operate a motor vehicle, you’re required to carry a certain amount of liability insurance, and collision and comprehensive. There are additional protections, such as medical payments, emergency roadside assistance, and uninsured motorist protection, which can offer you further benefits and peace of mind.
Your car insurance policy protects you from financial loss. If your car is damaged or totaled in an accident, your insurance can help pay for repairs or a replacement. Even if you’re at fault in an accident and damage another car, you won’t have to pay more than your deductible to cover the repairs required.
Similarly, if an auto accident leaves you or others with physical injuries, you don’t have to dip into your retirement account to pay the hospital bill. In a worst-case scenario, another driver may even try to sue you after an accident. Your auto insurance has a liability portion built in to ensure you won’t have to declare bankruptcy if this happens.
If you used a lender to purchase your car, your auto insurance can benefit you in more ways than you think. If a car is totaled, insurance will pay you what the car is worth. But if you’re upside down on your loan, you might still end up owing money despite not having a car. To prevent this, you can get a rider for your car insurance policy that covers the gap between what you owe and what the car is worth.
Auto insurance always includes liability insurance, because it’s required by most states and by your lender, if you don’t own your vehicle outright. Liability insurance acts as a shield in protecting your financial assets, even if you make a serious error while driving that leads to a crash.
Collision insurance covers your vehicle when you hit something else. That can be an accident involving another car or a tree or a telephone pole. If your car rolls over into a ditch, collision insurance will pay for the car repairs.
Comprehensive insurance covers your car with other types of damage. For example, if a tree falls onto your car or your car gets vandalized or stolen, comprehensive insurance will cover your loss. Comprehensive coverage is also activated if an animal collides with your car. You can decide how much comprehensive coverage you want. Unless you can afford to buy a new car, full-coverage comprehensive is usually the best option.
If you don’t currently have health insurance or you’re covered by a high-deductible plan, you may add medical payments to your car insurance plan. This can help defray the cost of doctor visits if you or a family member are hurt in a car accident.
Most people can also benefit from emergency road services. Whether the battery dies, your transmission goes out, or you had a tire blow out, roadside assistance can benefit you. A technician can come out and put on a spare tire for you, but they can also tow your vehicle to the nearest auto mechanic for repairs. Having emergency road services can make an unpleasant situation a little more manageable.
Finally, it’s not a bad idea to add uninsured/underinsured motorist protection, even if it’s not already required in your state. If you get hit by another driver who doesn’t have car insurance, or doesn’t have sufficient insurance to cover your expenses, you might end up paying for the repairs yourself. Uninsured/underinsured motorist protection means you won’t be left hanging, especially since the accident wasn’t even your fault.
Car insurance may be required for everyone, but every policy is different. We can tailor your personal car insurance to ensure you get the coverage you need. Having the right type of insurance ensures you can rest easily at night. Contact us and let us walk you through your insurance needs today, and we’ll find the best auto insurance for your situation.