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Car insurance : What to Look For in an Auto Insurance Company

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Auto insurance companies cover you and your passengers in the event of an accident. But it is up to you to decide the level of cover you will get. Will the damages to your property be covered by the company? Will all the passengers be covered or only your family? What if your child was driving your car?  What questions should you ask your auto insurance company when it comes to auto insurance?

Liability insurance or third party insurance is generally the lowest form of insurance offered by an auto insurance company. This is the basic insurance, if you are involved in an accident, and it is proven to be your fault, the auto insurance company will pay damages to the other party. The cover offered by the auto insurance company is usually set beforehand. These are the maximum amounts the auto insurance company will pay in case of an accident. You need to confirm with your auto insurance company what they will cover and what the limits are. You might be offered a very low premium by some auto insurance company only to realize that your cover is minimal and unrealistic.

An auto insurance company will also offer you a comprehensive insurance. In simple terms it means that if you are responsible for a collision, the insurance company will pay for the repair of the vehicle.

But it is not so simple; an auto insurance company will almost always have the final say on what amount will be paid out, so if it is cheaper to give you market value for the car, then they will. You must make sure that the insurance company is not in control of the market value of the car.

As with the third party insurance, the auto insurance company will almost certainly limit the amount that will be paid out, but in general terms, a comprehensive insurance will have higher limits.

A recreation vehicle needs its own insurance, a Recreation vehicle insurance is not the same as auto insurance. You should not assume that because your car is comprehensively insured, so is your recreation vehicle.

Medical (MedPay), Persona Injury protection (PIP) and no fault cover insurance will cover you and your passengers’ medical expenses in the event of a collision. The no fault cover means that the auto insurance company will pay regardless of who is at fault. This gives you the peace of mind that, at the very least, your family and friends are covered. PIP is often a minimum requirement in some countries; ask your auto insurance company what the requirements are.

Uninsured/Underinsured motorists’ coverage, also sometimes a minimum requirement will cover you if the person at fault is not insured or is underinsured. You must ask your auto insurance company what you will be charged in case of such a situation. Normally the auto insurance company should not charge you some extra premiums.

Most countries will require a certain level of cover, from full comprehensive car insurance to third party auto insurance. In most cases it is up to you, the driver, to ensure that your auto insurance company offers you the minimum required. In most cases the insurance company is under no obligation to instruct you of the requirements.

But of course, a good auto insurance company will, (should?), try its outmost to advise you on the best deal for you.