Car insurance plays an important role in the life of car owners. It is only way that would help the owner or the driver to get compensation for the damages occurred to the vehicle. In order to acclaim the cost for damages, the policyholder has to pay his premium regular to the insurance company, which might be on monthly basis, quarterly basis, or even annual basis. The insurance companies consider various factors while providing car insurance to people such as their age, occupation, marital status, accident claims, cat type and model, year of manufacture, location, driving history, car value etc.
Types of insurance: Policyholders have a variety of options when purchasing car insurance, some of which are settled by the state they live in and/or the investor if they are finance or leasing the car. Most states say for a minimum amount of liability coverage, while most finance companies require full coverage. The premium paid by policyholder to insurance company is determined based on area of coverage of the policy.
Following are the types of insurance that are available:
Body Injury Liability: Liability insurance compensates in case of any damages caused by the car owner’s action. It covers injuries suffered by separate people or end of person/persons because of car owner’s activity. It also covers all the damages occurred on the car.
Collision Insurance: It is also known as Collision coverage (COLL.), which pays for compensation for the car when a third party car or an additional target hits it. It is wise to maintain a large but cheap deductible as it helps to protect the car protection premiums low. This type of coverage is not suited for old cars since it depends on the value of your car in interchange. If the driver does not have the insurance, it will only cover the policy holder’s car.
Comprehensive Insurance: In case of covering any damages of car as well as borrowed or rented car, policyholder should take comprehensive insurance policy. It covers various sorts of loss including theft and uncolored disaster alteration such as fires, floods etc. It is also wise to check the terms and conditions in the car insurance policy since the coverage differs from policy to policy. The insurance coverage limitations regulate the amount to be paid up for each policyholder.
Uninsured Motorist Insurance: When collision insurance policy will allow coverage in the case that a responsible driver does not have insurance, uninsured motorist insurance enhances that coverage and covers the policyholder’s car in the case of a hit-and-run collision, even whenever there is data on the other driver.
Full Coverage Insurance: When an insurance policy covers all of the above-mentioned sorts of insurance policy, it is called as the full coverage insurance. Policyholders who are financing or leasing a car generally take this type of insurance policy.
These are the different types of insurance policies available for the person to consider while opting for car insurance. After selecting a particular insurance policy, it is important to pay the premiums in time immediately.