Comprehensive Guide to Auto Insurance


Auto insurance can be a very new territory to many people who are just getting there first vehicle. There is so much to know that even seasoned road veterans will not know it all. You need to know how much you need, what will affect you, where you can get it; there is a lot you need to know. But that’s why I’m here. This article will try to cover some auto insurance basics for the new auto insurance coverage purchaser.

First, you need to know that in most countries and states it is a requirement by law that you carry sufficient auto insurance coverage. This is so that in the event of an accident or collision, you will have the financial backing to cover all the costs incurred and will not become a burden on anyone else. This is to insure that if you hit someone, they won’t have to suffer financial hardships because of your folly. Its really a great law that protects all drivers have financial ruin due to someone else’s bad judgement or poor driving skills.

The amount of minimum coverage you will need in order to drive legally in your area will depend on your area, obviously. Every area varies by their requirements, some are significantly cheaper then others. You may be lucky enough to live in one of the cheaper areas. Be aware though, they just having the minimum coverage for auto insurance is not always a great idea.

Why? Well if you get into an accident, the auto insurance company will only cover up to the amount you are covered for. This could leave you thousands of dollars into debt if you only have the bare requirements for auto insurance.

You could end up having to pay tens of thousands in hospital bills. You could also be dragged to court by the other person for having insufficient coverage and they will sue you for their costs as well. This will result you not only being in debt to cover the costs of damages and hospital bills but also lawyer fees and court fees. Not to mention the toll all this stress and time and frustration will take on your health.

Ok, so now that you know you are best off in getting a decent amount of coverage, what will affect your auto insurance rates?

Well, chances are being that you are a first time auto insurance buyer; you are also under 25 years of age. This means that your rates will be higher then that of your parents (unless your parents are accident prone). Why? Well, statistically young drivers are more prone to accidents because they lack a lot of road experience and are more prone to distractions and risky behaviour.

As well as your age, your gender will affect your auto insurance rates. Men tend to get into more accidents than their female counterparts, and thus the auto insurance companies are going to charge you a higher rate for being male. It’s really not fair, but its what they do.

As well, your accident history will greatly affect your auto insurance rates, but being new to auto insurance buying this is not something you have to worry about now, but it is a good thing to know for the future. Basically, if you get into an accident your auto insurance rates are going to rise.