Your Most Common Auto Insurance Coverage Questions -- Answered
When it comes to insurance, we still have a lot of queries
, especially when it comes to auto insurance coverage questions. It is a pretty broad and complex topic, and it would best help if you start with the most basic and the most frequently asked questions."What exactly is an auto insurance coverage?" This is what most people ask first when this topic comes into mind. This is basically a term of agreement between the insurance company and the person who buys the insurance. It is a legal agreement that involves paying a certain amount of money to an insurance company in exchange for protection against certain losses, damages, or accidents involving the policy holder's car.
"Does everybody need car insurance?" In the United States, all citizens of all fifty states are required to have car insurance. It all depends on the limits set by each state. Even if you have a car loan, you still need insurance since almost all car loan companies require this before you can do business with them.
"If someone borrows my car, is that person covered?" Yes, anybody who uses your car is included in the car insurance coverage but you need to include that person in the list first before they can take advantage of the insurance. Here's a helpful tip: If you have family members who have driver's licenses and who use your car on a frequent basis, it is better to sign them up on your insurance policy.
"Why am I charged with a higher amount than what the agent told me?" Insurance companies refer to these situations as "misquotes". This means that you as a policy holder were not able to give out accurate information to the insurance company. You need to give out the correct details to ensure that all the factors that determine the amount you pay will give you the right amount. The price of car insurance depends on a lot of factors, such as the type of car you use, age, driving record, and your residential address. It is also possible that the agent made some mistakes in computing for your monthly payment. Always double check everything before paying for certain insurance.
"If my car is totaled, will the insurance company pay off what I own in loans?" Car insurance companies almost never promise to pay off the exact amount of what you owe. Instead, it determines the actual value of your car in cash. This means the value of your car in cash way before the accident happened. For any unpaid amounts, it is still your responsibility to pay them off.
Getting car insurance can only take you so far. Accidents cannot be foreseen; that is why we need something to rely on in case of accidents. It is also or your own good, that you will be protected by the best coverage. By starting with all your auto insurance coverage questions, you will soon be able to familiarize and understand the whole insurance process.
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