Various Auto Insurance Options Explained

If you are just getting auto insurance for the first time, or are considering switching insurance companies after a few years, it can be very easy to get bogged down with all of the terms and legalese. What car insurance do you need? What coverage is required? What isn’t required? What options can I do without? And what options should I have? All of these questions are very common for those that are just starting the process of looking into auto insurance, and we will cover all of those for you here, so that you can cover all of your needs in auto insurance.

When it comes to auto insurance, you have a lot of options, actually. In fact, any auto insurance company will give you every option you want, so long as you are willing and able to pay for it. But in the days of recession and a tight economy, you are probably wanting as few options on your policy, with all of the right coverage. Liability, comprehensive, and collision coverages are the standard options when it comes to auto insurance. Additional options include uninsured motorist, towing, rental car insurance, among many others. What do you need, and what do you want out of your auto insurance policy?

Liability insurance is the one part of auto insurance that isn’t optional in America. You are required to carry liability insurance in every state, and this insurance will protect you from financial losses in the event of an accident for which you are found to be at fault. Collision insurance on the other hand covers YOUR damages in the event of an accident for which you are found to be at fault. So if you are in an accident, and it is your fault, you will not experience any financial costs if you have both liability and collision insurance. But not every state requires collision insurance. Check your state and lender requirements if your vehicle is financed to determine if you require collision insurance. In most cases, you can lower the cost of your auto insurance by putting a deductible on your collision insurance, so you will still get the protection you need at a lower cost.

Comprehensive insurance is insurance that is frequently optional, but you also want to check your state requirements just to be sure. This kind of insurance will cover you against financial loss in the event that any loss or damage is sustained by your vehicle for any event that is not a car collision or accident. Comprehensive insurance then covers a comprehensive set of events such as theft, vandalism, or acts of Mother Nature (i.e. if a tree falls on your car during a storm).

These three types of insurance coverages are options offered by every insurance company. In addition you will find other options that you may or may not want. Most of these additional options will come at extra costs, so always do your insurance homework to find out what kinds of auto insurance options you want, and compare those options with your current budget. You can always save on auto insurance if you tailor your policy to your needs, rather than your wants.