Buying Car Insurance
Learn about the different types of automobile insurance coverage and how to cut costs when insuring your car.
Most states require that every registered vehicle carry some sort of auto insurance. But even if there were no such requirements, all drivers would be wise to think carefully about how much and what kind of insurance coverage they need. According to the U.S. Department of Transportation, 6.9 million vehicle crashes were reported to police in 2004. Before you do buy insurance, however, you should know the basics.
Liability Insurance
If you are at fault in a car accident, liability insurance pays for the damages that you cause to someone else. It does not pay for your own damages. There are two kinds of liability insurance: bodily injury and property damage. Bodily injury expenses include medical bills, rehabilitation expenses, and lost wages. Property damage expenses include the repair or replacement of any items belonging to another person that you damage or destroy.
Liability insurance usually covers the following people:
- Named insured. This is the person or people named in the policy, no matter what car they are driving.
- Spouse. Even if the spouse of the named insured is not named on a policy, liability insurance almost always covers him or her, unless the couple does not live together.
- Other relative. This is anyone related to the insured by blood, marriage, or adoption and who also lives in the household. Usually legal wards and foster children are also covered.
- Anyone driving the insured vehicle with permission. Someone who steals the car is not covered.
|
|
