What are the different types of car insurance?


Here are the types of car insurance that are available to those who are looking for car insurance for their car. First is the ‘Fully Comprehensive Auto Insurance’. As its name suggests, this is the most expensive and the most common type of car insurance. It is the most expensive, because it insures the owner of the car against all kinds of event, from fire, accident, whether you don’t show ‘fault’ to the accident or if not your fault and the other party has no insurance, to theft that is why it gives the car owner the right to claim against the insurance company. On the other hand, read the insurance policy carefully, because some companies refuse to insure the car’s value 100%, rather they just insure 80% of it. This is to prevent fake loss of the car where the owner is either financially unstable or he/she doesn’t want the car anymore.

Next type and considered the middle type is the ‘Third Party, Fire and Theft’. This is well-liked by those who still have a certain level of intrinsic value in their car but already paid their car loans. It is the same with the fully comprehensive auto insurance in terms of covering situations like fire and theft. On the other hand, if you had an accident and you hit a wall, you only damaged your car, or the accident is with another driver and you are not at ‘fault’, the company won’t be required to pay, despite whether or not the other driver has sufficient insurance to pay for your car’.

The third type is known as the ‘basic’ type and also the cheapest is the ‘Third Party Insurance’. Although it is the cheapest, it only covers when you had an accident, you are at ‘fault’ and you hit a third party. In all other situations, the company is not required to pay. And so this type is usually purchased by car owners with old car either has little value or none at all.

Last type of car insurance would be the ‘Specialized Car Insurance’. Any car that is over 25 years old is considered as ‘classic’, and all classic cars should be insured under classic car. Cars under ‘classic’ has the same benefits like the fully comprehensive auto insurance, but the downside is that usually there is a limit to the road mile you can travel per year, so checking your insurance policy carefully would be advisable.