Getting insurance for your vehicle is a way of insuring the life of your vehicle. Car manufacturers are constantly churning out the fanciest models, cars and bikes that defy gravity and every other law of physics. These designer vehicles cost a pretty penny and it is usually with a sense of fear that owners take these dolled up beauties out for a spin. In the warm comfort of the showroom, the car looked like it could single handedly take down a small army, but out on the streets besides the big trucks, the car looks shockingly small and vulnerable. The options are few: The shiny car either stays in the garage or you go out and find your self an insurance policy that covers vehicle damage.
Thankfully, there are many such policies available. All insurance companies have auto insurance or vehicle insurance. While the details of the package may vary, the basic concept remains the same. The company will pay for the repairs in the event of an accident or liability that can be proven. Usually, auto insurance applies to the insurance provided to all class of vehicles. However, Insurance Companies have come up with various types of insurance policies that seem almost tailor made to fit customer needs. There are policies applicable to only high end models. These policies usually have a higher insurance premium, which is calculated based on the market value of the vehicle.
The more expensive a vehicle, the more expensive its parts will be to replace. Insurance companies are generally wary of high end vehicles because these are also high speed vehicles. The chances of crashing into one of these cars or bikes are considerably higher than with a lower speed vehicle. However, the point being that insurance companies these days have policies structured around the type and class of vehicle. This prior analysis also takes into account the personal details of the insurer before the company suggests one insurance policy over another.
The premiums charged on these policies can either be fixed according to government specifications of framed by the insurance company itself, however keeping close to government guidelines. Like mentioned above, the premium is fixed after taking into account various aspects – The retail price of the vehicle to be insured, the features and class of the vehicle, The personal details of the insurer etc.
These days, insurance doesn’t stop at reimbursement. It represents a company takeover of customer liabilities. Given the high incidence of accidents and other traffic related calamities, it is always safer to invest in auto insurance. Different countries have different insurance policy frameworks. In the United States of America, an insurance policy that covers liability claims is most popular. Again, the features of the same type of policy can change from one insurance company to the next.
The basis of liability insurance is that the insurance company will cover all costs incurred by the driver of the vehicle in the event of an accident. Therefore, the owner is reimbursed even if the accident is his/her own fault. This is particularly useful if a driver is usually the one operating the vehicle. In most cases, a minor lapse of judgment or failed vision can lead to the most horrific accidents. Furthermore, one can never accurately gauge the negligence of every other driver on the street.