Car Insurance -- Explaining Things

When you buy car insurance, you enter into a contract with the insurance company. Under the contract, if your car meets with an accident, the insurance company must pay for the losses. Paying the premium is your obligation under the contract.

Property, liability and medical coverage are all covered by car insurance. Property coverage pays for damage to or theft of your car. The liability coverage will pay for your legal responsibility for bodily injury or property damage caused by your car.

The cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses are taken care of by the medical coverage.

Majority of the car insurance policies are valid for six months to a year. When the validity is over, you must renew the policy.

All states require you to have some form of car insurance if you own or operate a car.

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The penalty for driving a car without insurance varies from state to state. Some states impound your car. There are heavy fines in some states. If your car is involved in an accident without insurance, the consequences can be serious. You will be financially responsible for paying for any injuries or damages out of your own pocket.

Your credit history, the age and type of your car are also vital factors in determining the rate you have to pay for car insurance.

You are responsible for providing insurance for any car you own regardless of who is operating the car. If you operate a car without insurance, you will be in violating the law.

Finally, a few savings tips...

1. Although this may sound funny, you can bring down your rates by getting married. I know you won't get married just for this but when you do, it will save you a bit in auto insurance. Insurers have statistical data that show that people are less reckless and much more careful on the road when they get married. They generally file fewer claims and when they do, they usually cost less.

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2. "Pimping your ride" does NOT help if you want lower rates. Things like changing your tires to bigger ones than specified by the manufacturer, adding equipment that will increase your car's horse-power will cost you a lot more. So if you're really serious about keeping your rate down, leave your car the way it was manufactured.

3. Do you know that some folks are paying much more in auto insurance because of where their homes are? Do you know also know that homes within the same neighbor might actually fall into different risk zones according to the insurance industry's mapping?

So check with your agent before you commit to a new home. The truth is that most people don't think about this when they are about buying a home.

But think about it: If your new zip code adds up to $300 to your annual auto insurance rate, how much would that amount to at the end of your 30-year mortgage?

4. A lot of folks have lost their cars in the short seconds that they took to dash inside to get something while leaving their cars running and unlocked. Don't make this mistake. This simple act makes it very easy for thieves. Remember, they look for easy targets. And what could be easier than a car that's ready to be driven away -- It takes just seconds.

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5. As an under twenty five, you can pay lower car insurance rates if you use your parents' policy. The fact that you're of driving age means that your parents belong to a better risk age group.

There are two conditions that you must fulfill to make this possible: The vehicle must be registered in your parents' name and you must live with them. If you want to be the owner of your car, then be the big boy or girl and also own the costly rates. Sorry, you can't have both with this option. However, you can still make a lot of savings by clicking the link at the end of this piece.

6. While you take these other steps to reduce your auto premium, here's something you can do to get lower rates now: Visit trusted insurance quotes sites and obtain quotes.

Visit at least five of such for the best results. It's free, quick and easy. However, ensure you give your correct details as you fill the forms presented. The last step is to just pick the insurer that gives you the best price/value from the quotes return.
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