Congratulations! You already have the car of your dreams. But you have to get your car insured before you can go out on the road and have a fun ride. But do you know anything about auto insurance?
Auto insurance is a kind of insurance that can be bought for cars, trucks, and other types of vehicles. It protects against losses that might happen. Getting auto insurance can protect you from the cost of fixing your car after an accident, depending on the type of coverage you buy. The cost of buying a new car if the old one is stolen or damaged beyond repair, as well as the cost of legal claims against the driver or owner of the car if the car damages or hurts someone else.
Comprehensive insurance doesn't cover all of the risks that come with getting a new car. Due to the sharp drop in value right after a car is bought, there is usually a time when the remaining car payments are more than what the insurance company will pay for a totaled car. In the early 1980s, GAP insurance was set up to protect the consumer on the market. GAP protection was made because car prices were going up, auto loans were getting longer, and leasing was becoming more and more popular.
Liability insurance covers claims against the policyholder and, in most cases, any other driver of the insured vehicle, as long as they do not live at the same address as the policyholder and are not specifically excluded from the policy. All of the people who live at the same address must be named on the policy. Most of the time, liability insurance won't cover the policyholder if they drive a car that isn't their own. You are only covered by someone else's policy if you drive a car that person owns.
When you rent a car, your liability insurance also goes further. But in most cases, full coverage or policies that cover everything may not be used. Because the insurance company doesn't want to be responsible for a claim that is worth more than the insured's car, and a rental car could be worth more than the insured's car. But in some states, it also applies to cars you rent. Most companies that rent cars also offer insurance to cover damage to the car. In some places, "Loss of Use," or the costs of not being able to use the vehicle, are also covered.
You should get auto insurance now that you know what it is.
