Car Insurance 101
The road to responsible driving starts with learning about car insurance. No single purchase is more important when operating a vehicle and without the right type of insurance you can be subject to fines, penalties and even personal liability. Having a car insurance policy is not enough, you need the right type of car insurance coverage with policy limits that are sufficient to provide coverage in a car accident. Anybody can pay premiums and purchase a policy which offers some form of insurance however the value behind car insurance is having sufficient levels of coverage from a car insurance company who will be there to pay when you file a claim.
How much car insurance do I need?
This all depends on where you live, your personal finances, number of household drivers and other factors. Every state has minimum car insurance requirements drivers must obtain to comply with the law however these requirements are often just enough to cover the average cost of a vehicle and rarely provide any coverage for you or your vehicle if the accident was your fault.
Liability Insurance is the most common form of required car insurance by state law however liability insurance only provides coverage to other people’s property, damages and injuries in a car accident. If the accident was your fault then with a liability only policy you actually have no coverage at all even though you have been paying premiums every month. It’s important to understand the types of car insurance and how they work before buying coverage. While there are many forms of car insurance the most common types are:
- Liability Insurance
- Comprehensive Coverage
- Collision Insurance
- Uninsured Underinsured Motorist Coverage
- Medical Payments Coverage
- Personal Injury Protection
- GAP Insurance
Simply click on any of the types of insurance above to learn more about how they work or visit our car insurance questions section here. It’s always important to consider a car insurance policy with several types of different coverage versus only complying with state minimum requirements.
How much can I expect to pay for car insurance?
The cost of car insurance varies according to where you live, your driving record, the type of car insured and more. While most good drivers average $125 a month in auto insurance premiums for a typical vehicle you can often pay much higher or much lower depending on your overall risk profile. Drivers in states like Michigan and Louisiana for example, can expect to pay almost $200 a month compared to residents of Ohio or North Carolina where it’s under $100 a month. Young drivers and higher risk drivers can even pay 100% more or higher than good drivers. While the average cost of car insurance is affordable for many it’s important to compare car insurance quotes from multiple providers as even $10 or $20 a month can add up over the course of a year.
However the cost of car insurance is just one factor to consider. The quality of insurer, the type of coverage, how much you are insured for and many questions should be asked before buying a policy. Do you know the answers to these questions? There are literally 1000’s of car insurance questions and to find the best coverage for your family you really need to have a good idea of the type of coverage you need and focus on cost as the last factor in any decision.
How can I save money on car insurance?
Car insurance companies offer a number of ways to save money with car insurance discounts. From customer loyalty discounts to good driver discounts most consumers are eligible for some form of discount on their car insurance. However the catch is not all car insurance companies were created equal so the same car insurance discounts are not present at every insurer. Before starting a car insurance comparison search it’s a good idea to learn about what car insurance discounts are available and make a list of the ones you may quality for. Then when you are comparing car insurance companies ask them to include all of these discounts in your quote. Sometimes car insurance discounts may not be published but are available if you ask.
What are the penalties for driving with no insurance?
Driving with no car insurance is the equivalent of walking around with a ‘SUE ME” tattoo on your forehead. Not only are you subject to fines and penalties by the state which may even include drivers license and vehicle registration suspension but it’s even possible to be given jail time in some incidents. This however is the least of your concern as driving with no car insurance puts you on the hook personally for any damages caused in a car accident. One wrong move and your family could be bankrupt from your decision to drive with no insurance.
We have a wealth of information about car insurance online including links to some of the most valuable resources on the web so browse around and when you’re ready start a car insurance comparison search by simply entering your ZIP code above.