Common Auto Insurance Questions
When you are in the market to purchase an auto insurance policy, many questions may come up. There are so many terms used and it’s very important you understand what some of these terms mean. Provided below are a few of the common terms you will hear when buying auto insurance.
What type of auto insurance do you need in order to drive legally?
In most states it is required to have at least liability coverage. This coverage pays out for damages or injury you cause to another motorist if you are negligent in an auto accident. Most states have set minimum limit
requirements for auto insurance. For example Arizona’s state minimum limits are 15/30/10.
15: $15,000 for one person’s BI or Bodily Injury – Paid out to others.
30: $30,000 for all person’s BI or Bodily Injury – Paid out to others.
10: $10,000 for property damage you cause to the other vehicle or object.
State minimum requirements vary from state to state. This coverage will not pay for damages to your own vehicle.
What is an insurance deductible?
The deductible is the amount that will need to be paid in order for your insurance company to pay out for a claim you file. Common deductibles range from $250 to $1000. I personally like to choose a higher deductible to help lower my premium. I also prefer not filing claims unless the damage is over $1000. The more claims I file, the higher my rates will be.
What is Comprehensive Coverage?
Comprehensive is an optional coverage that will pay for fire, vandalism or theft to your vehicle. Basically comprehensive will pay for anything other than a collision. For this coverage to apply you must satisfy a deductible prior to collecting on a claim.
What is Collision?
Collision and Comprehensive are typically sold together. While Comprehensive pays for damages to your vehicle caused by anything other than a collision, Collision coverage pays for damages to your vehicle if you are in an accident. If the accident is not your fault, the other Driver’s liability coverage should cover the damages as long as they have selected suffiecent liability limits. If they dont have enough coverage or even no coverage, your collision coverage could also apply.
What can I do to get low cost auto insurance?
Combining policies with a single company is one of the best ways to lower your auto premiums. Another way to lower your insurance costs is by raising your deductibles on collision and comprehensive coverage. Always shop for coverage in advance and make sure to shop around. Online comparison auto insurance quotes are an effective way to shop for the best insurance policy at the right price.
Read more ways to get low cost auto insurance.