Car Insurance -- Things You Need To Know

Car insurance is a contract between you and the insurance company. Under the contract, if your car meets with an accident, the insurance company must pay for the losses. Your part of the contract is to pay the premium.

Car insurance provides property, liability and medical coverage. In case of damage to or theft of your car, property coverage will pay for the losses. 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.

Most car insurance policies are valid for six month to a year. You must renew the policy once it expires.

The law in 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. There are heavy fines in some states. Serious trouble. That's what's in store for you if your car is involved in an accident with insurance. You will have to pay out of your own pocket for any injuries or damages.

Your credit history, the age and type of your car will play an important role in determining the rate you have to pay for car insurance.

It is your responsibility to provide insurance for any car you own regardless of who is operating the vehicle. It is illegal for cars to be operated without insurance.

Finally, a few savings tips...

1. Getting married will bring down your rate by a huge margin. There is evidence to show that married people are a lot more stable than their unmarried counterparts. This makes them more careful on the road and, therefore, a better risk to insurers. Insurers will tell you that their records show that married people make fewer claims. Furthermore, when they do make those claims, they usually cost less on the average than those married by their unmarried counterparts.

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2. If you want to keep your rates down, do NOT "pimp your ride." Doing such reduces your car's safety and, therefore, warrants higher rates as far as the insurer is concerned. So if you're really serious about keeping your rate down, leave your car the way it was manufactured.

3. It's easy to save a few hundred dollars on a home but lose thousands over the years on auto insurance because of its location. Homes in the same neighborhood may fall under different risk zones as far as your insurer is concerned.

Therefore, take your time to ask your agent what effect your new zip code would have on your rates before you make that down payment. 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. 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. Car thieves are known to go for easy targets. An unlocked car with the engine running? What could be easier?

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5. Using your parents' auto insurance policy is an option for you an under twenty five. If you're of driving age, then your parents certainly are far above 25 years which means they're better risk drivers.

You must remember that the vehicle must be registered in their name and you must be living with them if you want to use this option. If you want to be the owner of your car, then be the big boy or girl and also own the costly premiums. Sorry, you cannot have both with this option. However, you can still make massive savings by following the link at the end of this piece.

6. Take out some time to visit at least 5 insurance quotes sites that offer quotes on auto insurance policies. Doing this will take you around 25 minutes.

While you visit each site, ensure you input the same information. Doing otherwise will give you misleading quotes. When you've received your auto insurance quotes, compare them to see which serves your interest best both in price and value.
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