Car insurance is insurance for automobiles, trucks, motorcycles, boats, and any other road vehicle. Its main function is to offer financial protection against personal injury or physical damage resulting from road accidents and against liability which can also arise from other incidents in a car. Car Insurance Near Me offers excellent info on this. Car insurance provides protection not only for the insured parties but also for third parties like pedestrians and persons on the roads. In most jurisdictions, it is compulsory for all motorist to obtain and maintain a valid driving license for his/her vehicle, for those who own a fleet of cars to have a minimum of liability coverage for all drivers, passengers and their personal cars. It is an important tool for vehicle owners, as without it they are at the mercy of others due to limited financial resources to pay for damages incurred in road accidents.
There are many factors that affect the premium amount of car insurance. One of them is the driving history of the individual, which indicates past record of safe driving, claims history if any, involvement in accidents and completion of prescribed classes. Insurance companies consider the individual’s behavior as a warning signal to ensure he is a safe driver and does not get into accidents. The rate of premiums is based on individual factors such as sex, age, marital status, experience, location and driving history. There are three types of car insurance policies namely, comprehensive, collision and uninsured motorists coverage. Each policy type has its own coverage, underwriting structure and benefits.
Comprehensive coverage offers extensive damage and financial protection to cover damages resulting from road accidents. This type of car insurance is for vehicles with expensive engines or highly expensive accessories. However, this is the most expensive type of coverage. Underinsured motorist and underinsured damages coverage provides financial protection to the policy holder or the individual driver from financial losses resulting from an accident when the insured is at fault but the person damaged is unable to pay for the damage. Collision policies pay the difference between the actual market value of the vehicle that is damaged and the amount the insurer pays to the policy holder or the individual driver in the case of an accident.