In the majority of the states, having car insurance is mandatory as per the law. So, what is the use of car insurance? Here is how car insurance works; for instance, if you happen to be at fault in a motor accident, your car insurance helps cover the liabilities as per the terms of the policy. Some of the losses that are covered by an insurance policy include:
⦁ Any damages to the other party’s vehicle
⦁ In the scenario the other party was injured, the insurance will help you in covering their medical bill
⦁ The policy will also help you cover any property damages caused as a result of the accident.
⦁ Additionally, if you are taken to court because of the accident, the insurance will cover your legal fees.
Here is a list of the benefits of having an insurance policy for your car;
It may be that insurance is mandatory in your state
Most you may already know by now that all states have laws in place that set the minimum liability coverage limits that car owners are required to buy. In other words, this is the maximum amount an insurance company is required to pay by the law to cover a claim.
For instance, if you happen to cause an accident and the other party’s medical bill surpasses your coverage limits, you could end up covering the bill out of your pocket. Therefore, you might want to consider increasing your insurance coverage above your state’s threshold.
Financial protection is perhaps the most important reason for you to insure your car. For instance, if you cause an accident, you may not have the financial ability to cover the cost associated with the accident. Nevertheless, if you have insured your car, the insurance company will help take care of any bill associated with the accident.
Auto insurance for leasing or lender agent
For example, if you are leasing or financing your car, the lender or agency asks you to purchase comprehensive coverage and collision coverage as a requirement. These two covers are meant to protect the leasing agency’s investment as they are the lienholders of your car as you continue making payments.
Having gap insurance can be an added advantage as it helps cover the car loan if the automobile is stolen or totalled. However, gap insurance is not mandatory and works with comprehensive and collision coverage.
Covering the cost of repairs
If you outrightly own your car, it is equally essential to have comprehensive and collision coverage. This is why. However, the mandatory liability cover will compensate for the damages to the other party’s car; it is also equally consequential to cover your automobile.
Take this, for instance, maybe you accidentally crushed into the mailbox, or you have hail damage on your car, or even worse, the car was damaged by fire. Regardless of whether you were at fault or not, comprehensive coverage will help pay for these replacements or repairs. With that said, get yourself a comprehensive quote to enjoy peace of mind.
Protecting your passenger
Personal injury protection or medical payments coverage comes in handy at such times. For instance, if you cause an accident, these policies may help cover your medical bills in case of injuries resulting from the accident. Additionally, they may also help to pay your passenger’s bills for damages resulting from the accident.
The coverage helps in paying for doctor bills, hospital visits, and surgery if needed. This is particularly helpful as you could have been otherwise paying from your pocket, were you not insured.
Despite liability coverage being a legal requirement, studies have indicated that most car users drive without it. Also, uninsured motorist coverage is an essential additional layer of protection for any driver. Nonetheless, this coverage is not a legal requirement in some states, but it’s equally important.
Why is it that important? For example, if you are accidentally hit or involved in a collision with an insured driver, this policy may help cover your medical bills.
Prolongs the value and life of your car
Some of these insurance covers like comprehensive insurance help you evade devaluation of your car. How is this possible? It is impossible to know when hail will damage your vehicle, or when a tree branch will shatter your windshield glass.
When your vehicle is damaged by such occurrences that are obviously beyond your control, such policies may help pay for the damages. In turn, this saves you a lot of money and leaves your car in a marketable state in case you decide to offload it.
In conclusion, in most cases, having the proper insurance coverage means going an extra step beyond meeting the legal requirements of your state. Having the appropriate insurance coverage for your vehicle means;
⦁ Protection for your car
⦁ Protection of your wallet
⦁ Most importantly, peace of mind