Automobile insurance is as important as choosing the right car to drive or own, especially when one wants to have that independent means of transport. There is a wide range of car insurance that can be purchased hence choosing the most suitable may be quite a challenge. This blog gives an overview of the various types of auto insurance and questions guiding selection depending on coverage, price and need.
This program covers anyone who may be at fault in causing the accident and stepping into the scene including pedestrians, passengers, other drivers and their families
Third party liability insurance can be said to be mandatory in many countries across the world. It refers to compensation for loss or harm to other people (Third Party) in an accident you alone or partly responsible for. This option is normally cheaper than the other two but it does not offer so much coverage.
Key Benefits:
- Legal compliance: It is satisfactory in regards to the obligatory insurance.
- Cost-effective: Primarily it is cheaper than all other forms of insurance.
- Basic protection: Both includes compensation for damages to property owned by others as well as for the medical bills of injured third parties.
Drawbacks:
- Limited coverage: That does not extend to your own car or the damages that you may cause to other’s property.
- No theft protection: You are not shielded against theft or vandalism.
- Lack of personal protection: In some types of policies, damages to the driver’s own person are barred.
- Such an insurance policy: It is ideal for those drivers that need the least amount of insurance necessary to fulfill the law or own cars that are no longer new.
Comprehensive Motor Car Insurance
Comprehensive insurance is one of the most used coverages since it offers broad coverage. It includes the compensation for the loss of third party property as well as for self-companies’ own car in case of an accident, theft, fire, or natural disasters. Moreover, some policies provide coverage for personal accident of the driver and the passengers.
Key Benefits:
- Extensive protection: Comprehensively protects you from the damages of third party, as well as your car in cases of an accident, theft, or natural calamities.
- Personal accident cover: Provides for the case when the driver and/or the passengers sustain injuries in an accident.
- Peace of mind: Full coverage makes you financially secure the occurrences, which are most likely to happen to you.
Drawbacks:
- Higher cost: It is usually more costly than the Third-party insurance.
- Deductibles: Some comprehensive policies may have high dedúcible which translates to the amount you willing be willing to pay in the event of an accident.
- Full coverage insurance is perfect for individuals who want insurance against all sorts of calamity that might befall their vehicle and are willing to pay more for it. It is advised for cars which are fairly new or those which costs a lot of money to replace.
The Third Party Insurance, Fire Insurance, and Theft Insurance
This type of insurance is good between the third party liability and the third party comprehensive insurance. It pays for third party injuries or property damage and your car is also shielded from fire and theft. But it does not apply to the injury of the car that one had accidentally caused an d was using at the time of the occurence of the accident.
Key Benefits:
- Affordable: More affordable than fully realizing insurance coverage but affords more than simple third party legal liability.
- Fire and theft protection: Insurance that gives you coverage in the event you lose your car through theft or it gets destroyed by fire.
- Covers third-party damage: Provides for legal minimums of liability to be carried by the owner of the motor vehicle.
Drawbacks:
- No accident coverage: You are also required to cater for the loss or damage to your own vehicle after a mishap.
- Limited personal protection: It also may not contain provision for compensation in the case of any one of the party getting injured in a accident.
- Third party theft and fire insurance: It is particularly useful for those who do not require fully comprehensive policy but need some extra cover apart from the third party liability.
PIP’s stand for Personal Injury Protection and is an automobile insurance
You may also read about – How to build a diversified stock portfolio- tips and tricks
Personal Injury Protection (PIP) sometimes called “no-fault” insurance pays for medical bills for the insured person and occupants of their car in the event of an accident no matter who is to blame. Others also include loss of wage and rehabilitation expenses on PIP policies.
Key Benefits:
- Medical coverage: Helps you and your passengers to get medical attention after an accident.
- Covers lost wages: PIP may also cover for lost wages if you are incapacitated by the injuries to be unable to work.
- No-fault system: In even in case you were negligent and contributed to the accident, you are catered for.
Drawbacks:
- Additional cost: PIP insurance is optional and means that it is offered along with your insurance policy but it implies additional cost.
- Not a replacement for vehicle coverage: It doesn’t cover car damage or the liability towards the third party.
- PIP insurance: It is suitable for people who are concerned with the personal injuries and those that often carry passengers in their cars.
List of Insurances that Should Not be Missed: Uninsured/Underinsured Motorist Insurance
Read more – How To Invest in Gold?- An Investor’s Guide
You we/underinsurance coverage in the event that you are involved in an accident with an uninsured/under insured motorist. It can also include payment for medical bills, auto damages or other expenses as result of the accident.
Key Benefits:
- Protection against uninsured drivers: Provides compensation for property damage if the other-driver has no insurance.
- Covers medical and repair costs: Can help cater for the cost of the injuries and related damages to vehicles.
- Peace of mind: Aids in stabilising the human-carrying object in unknown circumstances.
Drawbacks:
- Additional cost: It often modifies from the base to incorporate an additional amount to your premium.
- Not mandatory: In some areas, this type of insurance is not mandatory, so, you can simply reject it if you are comfortable with other types.
- Raising our particular limit of Uninsured/Underinsured Motorist Insurance: It is needed in regions by which there are many drivers being uninsured or if the consumer just wishes to be at an advanced level of security.
You may also check out – Analyzing Life Insurance Corporation of India (LIC): A Comprehensive Financial Overview
Conclusion
To sum up, the best car insurance is a policy that will be suitable for a particular person and his or her personality, as well as dangerous situation tolerance level. However, the most extensive protection plan is the one that allows covering any damages to the vehicle and the third party involved in the accident; but depending on the circumstances, some drivers may prefer third party fire and theft, or the basic third party only.
