Have you recently purchased a new car and found yourself wondering about how car insurance works? Maybe you’re just looking to brush up on your car insurance facts.
Either way, we have you covered. Keep reading for answers to the most frequently asked auto insurance questions.
Shopping for Car Insurance
There are questions that frequently come up about choosing auto insurance and where to get an auto insurance policy. Here are some of the most frequently asked questions in this category:
Where can I buy car insurance?
A quick internet search will turn up many national and local car insurance companies. You can buy car insurance directly from one of these companies or an auto insurance broker that offers insurance from several companies. It’s a good idea to compare auto insurance quotes to make sure you’re getting the best possible deal for the coverage you need.
How Much Does Auto Insurance Cost?
The average cost of car insurance in the U.S. is $1674 per year. However, the price of car insurance varies based on several factors. Some of those factors include age, where you live, average daily distance is driven, the type of car you have, and the type of coverage you need.
What’s the Difference Between a Deductible and a Premium?
A deductible is a money you pay toward an accident or claim. This is paid out of pocket when you file a claim under certain coverages.
A car insurance premium is an amount you pay the insurance company regularly in exchange for coverage. This is usually on a monthly or biannual basis. The higher your deductible amount, the lower your premium amount will be.
Is Car Insurance Required?
In most states, some form of car insurance is required. The minimum amount of coverage varies by state, so be sure to look at your state insurance requirements before purchasing.
New Hampshire and Virginia are the two states that do not require drivers to buy insurance. However, there are minimums in place for those drivers who choose to buy insurance.
When Should I Buy Car Insurance?
You should buy car insurance before you drive your car. It’s illegal in most states to drive without insurance, and it leaves you financially vulnerable.
Car Insurance Coverage
Now that you know where to buy car insurance, you may have some questions about what it covers. Below are some of the most frequently asked questions about types of coverage and what they cover.
What does Car Insurance Cover?
Generally speaking, car insurance covers you, your car, and others involved in a car accident. Coverage varies based on the type of policy you purchase.
What Are the Different Types of Car Insurance?
There are several different types of car insurance available. Some of them will be required by your state, while others are additional options you can purchase. Types of car insurance include:
- Bodily injury and property damage liability coverage caused to other people or property
- Personal injury protection to cover medical expenses
- Collision coverage for damage done to your vehicle in collisions
- Comprehensive coverage for damage done to your vehicle in non-collision (vandalism, fire theft, etc.)
- Uninsured and underinsured motorist coverage to protect you in the event of an accident where the other driver doesn’t have insurance
Does My Car Insurance Cover Other Drivers?
Whether other drivers are covered under your insurance depends on the specific policy you have. If your policy has an “omnibus clause,” it covers any driver who has permission to use your vehicle. Before letting someone borrow your car, speak to someone at your insurance company to determine if your policy will cover them.
Insurance Questions Explained
From types of coverage to premiums and deductibles, now you have the answers to the most frequently asked insurance questions. With this knowledge, you should feel confident choosing auto insurance that is right for you.
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