The Importance of Insurance

Your Guide To Auto Insurance

20 April 2023

Katrina Terry

Auto insurance helps cover some or all the costs associated with some or all auto accidents. The exact coverage varies from policy to policy and carrier to carrier. If you would like to know more about auto insurance, keep reading. 

Are You Required to Have Insurance?

The exact laws regarding auto insurance requirements vary from state to state. Some states don't require you to purchase any auto insurance to legally drive, but most states require a minimum of liability coverage, which pays for medical bills and damages for the other driver if you cause an accident.

If you are leasing the vehicle or still repaying the loan, you may also be required to purchase additional coverage to protect your vehicle in the event of an accident. If you are required to have insurance and you are pulled over without insurance, you may be required to purchase SR-22 insurance. SR-22 insurance simply requires you to prove to your local DMV that you have insurance each month.

Which Type of Policy Is Best?

There are lots of different types of policies, but, besides liability, the most common include collision insurance, comprehensive insurance, and medical payment coverage.

Collision insurance provides money for you to repair or replace your vehicle if you cause an accident or are involved in a single-car accident. Comprehensive insurance covers the vehicle from non-collision-related causes like vandalism. Medical payment coverage provides money for your medical bills after an accident.

However, other types of insurance policies to consider include:

• Uninsured motorist insurance: protects you in the event of an accident involving an uninsured driver and/or a hit-and-run
• Underinsured motorist insurance: protects you in the event the other driver doesn't have enough coverage
• Personal injury protection insurance: covers medical expenses and some loss of income after an accident
• Gap insurance: fills in the gap between the car's current value and the loan

How Can You Reduce Premiums?

Like any insurance policy, you must pay a monthly premium for your auto insurance. Luckily, there are many ways to reduce your premiums. Most obviously, you can change your policy to less coverage. However, you may also find discounts for vets, military members, and students. You can also reduce your premiums by increasing your deductible and taking driving courses.

Auto insurance is incredibly important. Even if your state doesn't require liability insurance, you may want to consider a policy. If you would like to know more, contact an auto insurance carrier in your area today.

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