When you get ready for a car insurance comparison, there may be more to look at than just the bottom line of how much it costs. Knowing what to look for can make a big difference.
When you purchase a car insurance policy, you are actually buying several different types of insurance. While they all come from the same company, each type is designed to pay for a certain type of damage.
Liability insurance pays for damage you cause to another person’s vehicle or for injuries you may inflict on someone else while driving your car. Your state’s statutes will determine a minimum amount of liability insurance that you must have. The amount of liability insurance is often expressed in thousands of dollars. For instance, 10/20/10 indicates ten thousand dollars personal injury insurance per person injured, with twenty thousand dollars as the maximum paid per accident and ten thousand dollars in property damage insurance.
Comprehensive insurance pays for damage that may occur to your vehicle if it is vandalized or stolen. In addition, this insurance also covers any glass that is broken in your vehicle. Comprehensive insurance often has a deductible amount that you will have to pay out of pocket before the insurance starts to pay.
Collision insurance covers damage to your vehicle when you are in an accident and are at fault. Since you are responsible, you insurance pays to repair your vehicle. This insurance also often comes with a deductible amount. Collision insurance may pay to repair your vehicle or if the damage is too great to replace the vehicle.
If there is a loan on your vehicle, both comprehensive and collision insurance will pay the loan on a vehicle that is totaled before they pay you anything. This could mean that you will be shopping for a new vehicle with all the money from insurance paying off your wrecked car. In addition, there are times that you can actually owe more for your vehicle than it is worth. If you purchased gap insurance, it will pay off the vehicle, even though it is worth less than you owe.
Uninsured or underinsured motorist insurance pays to repair or replace your vehicle if the person who caused the accident does not have enough insurance to pay for the damage to your vehicle. This can happen even with people who have insurance, especially if they only have the state minimum amount of liability insurance. It also protects you if you are in an accident with a driver that does not have insurance.