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What to Know About Car Insurance and Indemnity


Car accidents happen almost on a regular basis, and that is enough to make drivers such as yourself to be worried enough to get car insurance for your protection and safety. There are different types of indemnity that are available to you and each one works different.

Here are the common indemnity types and their functions are simply explained, so make sure you have at least a good understanding of how each one would benefit you before purchasing one.

  • Bodily injury indemnity – this indemnity type covers and pays for the injuries of a third party in an accident, but only if it is proven that the policyholder is at fault and is the one responsible for causing the accident.
  • Property damage indemnity – the same with bodily injury indemnity, this type of indemnity covers and pays for the damages caused to a third party’s property when the insured is proven as the one who was at fault.
  • Medical indemnity policy – this indemnity covers the medical expenses of the policyholder when he or she has been injured in an accident, regardless of whose fault it is that caused the accident.
  • Comprehensive indemnity – covers the damages caused onto the policyholder’s vehicle that was not the result of car accidents, these causes include theft, fire, vandalism, and flood.
  • Collision indemnity – covers the damages caused onto the policyholder’s vehicle that was directly caused by collision of another car.

There is a common misconception that one’s insurance company would pay all the expenses when the driver is caught in an accident, thus drivers are willing to pay a lot for coverage. The truth is that some insurance companies do not always give full coverage, and there are always some exclusions in auto insurance.

As a driver, you should know that there is really nothing wrong in having car insurance. There would be a problem if you over insure or if you pay less than what you should for your coverage. Getting more coverage than what you need is more than a wrong move, you may not be able financially handle that much coverage. While paying less would mean that you would not be that much properly insured once something bad happens to you.

You should also check if a certain insurance company is reliable and credible, so you would have no trouble with being insured. It is recommended that you do some research and do some background check if an insurance company provides good service and protection. Otherwise, it would be better find an alternative insurance option so you would be protected while driving.