Cars. They are one of the most convenient modes of transport. According to Statista, there were over 268 million registered cars on the road in 2016. And in the same year, there were over 34,000 fatalities and a whopping five million car crashes!
Even if you abide by all the traffic laws, you can never be confident that you won’t get into an accident. This is why, according to Carsurance, over 87 percent of car owners in the US have the required car insurance. What a lot of people are unaware of is that there are different types of car insurance coverage.
Here is the most common type of car insurance coverage you should choose from.
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Liability Insurance
Most states of the US require car owners to have some type of car insurance. Usually, they require liability insurance.
What is liability insurance?
Liability insurances cover the cost of repairing any damage that your car causes to another vehicle or building, in case you are at fault in the accident. It also includes the medical bills that arise from the injuries the accident causes to other people.
Almost every state in the US requires car owners to have liability insurance. You should opt for one anyway since it protects you from bearing the burdening expenses of repairs and medical bills. While the state merely requires you to have minimum coverage, you should choose a better coverage.
This is because if you pick the minimum coverage option, you will become personally liable for any claim that exceeds the value delivered by your insurance coverage.
However, liability insurance is the bare minimum of car insurance. This is what is required by law for you to have. You must opt for other types of insurances on top of this one.
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Collision Insurance
One key issue with solely carrying liability insurance is that it only covers the costs and expenses of others involved in the accident. By the end of it all, you will still have to bear the expenses of repairing your car and paying the medical bills for your injuries.
This is where another beneficial insurance coverage comes in. Collision Insurance covers the cost of repairing your car. Even if your vehicle is totaled beyond repair, your insurer will be liable to pay you a sum of money that reflects the value of your vehicle.
Don’t be fooled. This amount won’t be enough for you to get your hands on a brand new vehicle. It will be the amount that your vehicle was worth before the accident. Factors like mileage, its condition, and previous accidents and repairs come into question when deciphering the value of the car.
Should you always choose collision insurance? Well, it depends on the age of your car. Let’s say that your car is quite old. You know that the premium you pay in insurance is worth more to you than the cost of repairing. In such a case, it is best to avoid car insurance.
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Comprehensive Insurance
Both Collision and Liability insurance have one thing in common- they exclusively come into action when there is an accident involved. But, a car gets damaged for various other reasons as well.
As per the National Insurance Crime Bureau, every 6.5 minutes, one automobile is stolen! Additionally, as per Consumer Reports, a deer-car accident ends up costing at least $3200.
This might have illustrated one thing to you; your car can be damaged by animals, thieves, and even weather. On such occasions, insurance policies covered above will be of no use to you. Here, a comprehensive insurance plan will be your safest bet.
In a comprehensive insurance policy, your insurer covers the expenses of all damages that can occur to your car. What’s the catch, you might wonder? Well, these plans are on the pricey side. You can significantly reduce the premium rate if you install an anti-theft device in your car.
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Personal Injury Protection
The cost of healthcare in the US is on the rise. You will be surprised at what an astronomical figure your medical bills amount to once you have been in a car accident!
At such a time, there are a few things that will come to your rescue. Firstly, a professional Winter Park personal injury attorney, and secondly, a Personal Injury Protection Insurance plan.
This insurance helps cover your medical bills regardless of whose fault the accident is. Additionally, it also covers the medical costs of the passengers in your car.
Unless you have a health insurance plan that provides optimum coverage, consider getting personal injury protection to save yourself from going broke after getting injured.
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Gap Insurance
Did you recently purchase your now damaged car in installments? In such a situation, a Gap insurance will come in handy.
This insurance plan is created for drivers who still have installments to pay off. In case your vehicle is totaled before you do so, Gap insurance allows you to cover the rest of the installment easily. Why would you want to do so? Of course, to sell the car off!
In case the value of the vehicle today is more than what it would be after a while, Gap insurance allows you to save as much of your investment as possible. However, if your car is totaled to the extent that it is not worth much, Gap Insurance won’t matter that much.
Ending Remarks
Regardless of which US state you reside in, make sure that you are well aware of the different types of car insurance plans. This will allow you to select the right one. Generally, a comprehensive car insurance policy, along with liability coverage, is sought.
Decide which is ideal for you depending on your life and health insurance coverage as well as on the basis of the value of your car.
Also, remember always to drive safely. Even if you are insured, don’t drive recklessly. Not to mention that doing so can end up increasing your premium!
Helen M
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