Auto Insurance 101

Does the process of researching auto insurance policies, getting customized quotes and finding a reputable insurance agent seem daunting? Although the process of finding the perfect auto insurance plan can take a bit of research, the end result is a policy that keeps you and your vehicle safe.

Auto insurance protects you in the case that you are in an accident, become a victim of theft, or have problems with your car. While coverage plans can be detailed, the basic premise of auto insurance is that you pay a set premium and in the case that you need to use your coverage- then the auto insurance company pays any losses.
The Basics

The first step in finding the perfect auto insurance plan for your vehicle is to find a number of insurance agents and get quotes from each one. Since each insurance company can offer different discounts, prices and policies, it's important to go to a few different companies to get quotes in order to get the plan best suited to your needs.

To receive an auto insurance quote online or through an agent, you will need to supply your vehicle identification number (VIN), year, make, model and body style of your vehicle.

The price of your insurance policy is dependent on a number of factors - the type of car you drive, your driving record and history, the type of coverage you choose, and how many people you include on your policy. Check with each insurance company you are receiving quotes from to find out what discounts you may be eligible for. If you end up buying more than just the basic coverage, expect your policy to cost more, although the extra coverage may benefit you in the long run. Shop around for rates in order to figure out what works for you.

Basic auto insurance can provide you with property, liability and medical coverage, while more detailed plans can offer much more. Depending on the state that you live in, you may be required to have, at minimum, liability coverage.

To understand the basic coverage options, you need to know the following:

* Property coverage: Once you pay your premium, the insurance company pays for damage to or theft of your car
* Liability coverage: Once you pay your premium, the insurance company pays for your legal responsibility to others for bodily injury or property damage
* Medical coverage: Once you pay your premium, the insurance company pays for cost of treating injuries, rehabilitation, and sometimes, lost wages

Deductibles and Premiums

Now that you have your coverage picked out, it's time to decide on your deductible and premium limits. A deductible is the total amount you will pay on an insurance claim while a premium is the actual amount of money you will pay to an insurance company monthly or annually in order to be covered. Remember, signing an insurance policy is equivalent to signing any other type of contract. Most deductibles are either $500 or $1,000 - the higher your deductible, the lower your premium.

Auto insurance 101 covers the basics, but do your homework in order to find the policy that best suits you. Ask questions, shop around for the best rates and coverage options, and do the research needed to find the auto insurance that will meet your needs