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What is Auto Insurance All About?

Insurance is a policy whereby one known as the insured pays another party known as the insurer for risk of loss. Therefore, auto insurance is insurance obtained for cars, trucks, motorcycles and other road vehicles. The primary aim of auto insurance is to provide security against damage of loss of vehicle for accidents and theft.

Auto Insurance policy varies from country to country but is common to have compulsory auto insurance before using a vehicle in most countries. This provides adequate provision for car and the car owner in the case of any accident from manmade or natural to the car and the car owner.

Auto Insurance can covers some or all of the following depending on the agreement between the Insured party and the Insurer:

  1. The insured party (medical payments)
  2. The insured vehicle (physical damage)
  3. Third parties ( car and people, property damage and bodily damage)
  4. Third parties, fire and theft
  5. The cost to rent a vehicle if yours Is damage
  6. The cost to tow your vehicle to a repair facility
  7. The cost of a new car

Also, depending on the agreement for the insurance, a particular vehicle can be insured again fire damage, accident damage and theft exclusively.

Auto Insurance Premium Charges

Depending on the agreement, the insurance premium can be mandated by the government or determined by the insurer with regulations from the government. When the premium is not compulsory by the government, the insure determines the premium for statistical inferences which can be based on the cost of the future claims by the insured. The insurance base this cost of factors like car type, car usage, inured sex, insured age, etc.

Auto Repair Insurance

Auto repair insurance is a type of insurance that covers wear and tear on a vehicle, independent of damages from fire, theft or accidents. This is branch of car insurance available in all the states of the US. Often, the drivers use this option to cover costly breakdown that may not result from gross accidents.

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