Car Insurance -- Clarifying It

By buying a car insurance policy, you are entering into a contact with the insurance company. Under the contract, the insurance company agrees to pay your losses if your car meets with an accident. In exchange, you agree to pay the premium.

Property, liability and medical coverage are all covered by car insurance. Damages or theft to your car are paid by property coverage. 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 paid by the medical coverage.

The validity of most car insurance policies is six months to one year. You must renew the policy once it expires.

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 is different in different states. Some states impound your car. Some states impose heavy fines. You could be in serious trouble if you car is involved in an accident without insurance. You will have to pay out of your own pocket for any injuries or damages.

The insurance company will consider your credit history, the age and type of your car before offering you a rate.

As the owner of a car, you are responsible for providing insurance for the car, no matter 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. Getting married will bring down your rate by a huge margin. It's commonsense that every person becomes more stable and less reckless once they get married. This stability affects such a person for good when he/she is behind wheels. Furthermore, as a group, their claims are usually less both in number and average cost per claim.

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2. Your rates will jump through the roof if you modify your car. Doing such reduces your car's safety and, therefore, warrants higher rates as far as the insurer is concerned.

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, as part of your home shopping activities, check how this neighborhood will affect your auto insurance rate. I know: That isn't usually an issue when you're looking for a home but it's really important.

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. Never leave your car unlocked and running while you dash in to get something. The only easier thing for a thief would be if you handed over your keys as a gift. Remember, they look for easy targets. It certainly doesn't get easier for a thief than an unlocked car with a running engine.

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5. A good alternative for you is to use your parents' car insurance policy. The fact that you are of driving age means that your parents are of a better risk age bracket.

There are two conditions that you must fulfill to make this possible: The car must be registered in your parents' name and you must live with them. This means that by law they own the vehicle. If the benefits of "independence" outweigh your car insurance savings then this is certainly not an option for you.

6. Make out some time to visit a minimum of five insurance quotes sites that return quotes on auto insurance policies. It should take you around 25 minutes.

While you visit each site, ensure you input the same details. Doing otherwise will produce misleading quotes. After you've obtained your auto insurance quotes, compare them to see which serves your interest best in price/value.
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