Vehicle insurance is basically insurance for automobiles, trucks, vans, motorcycles, and other road-going vehicles. Its primary function is to provide financial coverage against physical damage or personal injury resulting from road accidents and from liability which may also arise in a car. This policy protects the insured car driver against financial loss suffered due to traffic accidents as well as personal injury sustained as a result of being hit by another vehicle. Basically, it takes the form of a contract between an insurance company and the person driving the automobile. Here are some of the things that you should know about car insurance.
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One of the most important things to know about car insurance is what type of coverage you need in order to protect yourself financially from liability charges. There are two basic types of coverage that you can have. The first one is liability coverage, which is designed to pay for the cost of repair for physical damages to properties and injuries to people caused by the insured vehicle, as well as any medical bills resulting from such accidents. Liability coverage differs from state to state and even from company to company. Comprehensive coverage on the other hand, consists of all of the costs related to repairs, replacement, or restoration of the automobile after an accident.
Comprehensive car insurance coverage usually involves both physical and financial aspects. Physical damage coverage usually pays for the repair of the car involved in the accident, as well as for the medical bills and other expenses incurred by those injured. Financial damage coverage, on the other hand, takes care of paying debts of those who were injured, as well as of the owner of the vehicle that was damaged. Both of these types of coverage are required by law.
It must be noted that one of the most important elements of any auto insurance coverage is third-party liability. This component covers the expenses and losses that resulted from a collision between a driver of another vehicle and the insured automobile. Common examples of this type of accident include collisions caused by vehicles driving parallel to the motorist, collisions in which the driver of another vehicle ran a red light, or collisions in which the driver of the other vehicle made an unexpected movement that ended up causing an accident. While the details of these collisions vary, the insurance company that issued the auto insurance coverage is obligated to reimburse the driver or passengers of the insured automobile for the medical expenses and any other damages that resulted from the accident.
The next factor that an insurance policy must contain is collision coverage. Collisions are categorized as either “crash” or “accident.” In either case, if the other vehicle that was hit doesn’t have adequate coverage, the driver of the other car must have enough coverage to pay the difference. At-fault drivers are also required to have enough coverage in order to prove to the insurance provider that they were not the cause of the accident.
Another type of policy that most drivers don’t consider is commercial vehicle insurance. Commercial vehicular accidents occur when a driver of a large commercial truck causes an accident with another vehicle or employee of a business. This type of insurance protects business owners who transport products and/or employees to and from their respective locations. For example, a janitor who gets into a big truck accident with a delivery truck will likely need to obtain damage and liability coverage. Similarly, a person who vandalizes a car that he was driving can obtain liability and property damage coverage from an insurance provider.