If you already have a car, you probably already have insurance. If you are thinking about buying, you must already be counting insurance in your budget. right?
Auto insurance is mandatory in 49 of the 50 states of the federation and must be part of the fixed accounts of all vehicle owners in the United States. In fact, it should be part of the budget of anyone who owns a car in the world, but let’s limit ourselves to America this time.
What is auto insurance?
Car insurance covers damage to your vehicle and protects you financially if you are responsible for someone else’s damage or injury. It covers many risks that your car, you, your passengers and the drivers who cross your path, can take.
Auto insurance can pay for medical bills if you or your passengers are injured in an accident or if you are hit by an uninsured or underinsured driver. All this remembering that payments respect the limits contracted in your policy.
Do I need auto insurance?
Well, as we said, auto insurance is required in 49 of the 50 states. Only New Hampshire does not oblige you to have insurance, however, you remain financially responsible for any accident you cause. You will have to take out of your own pocket amounts that we rarely have at our disposal in an unforeseen event.
Driving without insurance can still result in a fine, suspension of your driver’s license or even imprisonment. If you’re reading this post in Portuguese, you’re probably an immigrant, you don’t want to risk your visa or your stay in the US because of a few “changes” a month, right?
We understand that for the lives of many, these exchanges may be needed, but we need to respect the laws of the country that welcomed us and ensure that our stay here is peaceful to prosper!
What are the coverages?
Car insurance covers various types of accidents, whether on the street or not . As each state has the autonomy to legislate, in addition to creating insurance criteria, coverage may differ from one to the other.
But let’s list the standard coverages on most auto insurance policies:
Responsibility – Liability
If you are found guilty in an automobile accident, this coverage covers injury or damage to other vehicles, property, and injuries to other drivers and their passengers. It also covers the costs of lawsuits if you are sued for an accident.
The lack of this coverage alone can lead you to bankruptcy or eternal debt, as the costs it covers are very high. Have you ever thought about being financially responsible for the account of several days of hospitalization in a hospital?
Comprehensive coverage protects against damage to your car caused by events beyond your control:
- damage to the windows
- Falling trees, branches and other objects
- Rocks, kicked objects or falling out of cars (I know you’ve been worried about this on some road at least once)
- Storms, hail, wind, lightning and earthquakes
- Floods (the only cover that will save you from losing your car in a flood situation )
- accidents with animals
Can you guarantee that none of this will happen to your car?
Collision coverage covers the situations we already expect car insurance to cover. If you’re looking for insurance that will fix your car in case you hit someone and smash the bodywork, this is the coverage you need.
Collision coverage covers traffic accidents such as:
- Accidents with other motor vehicles
- Hitting another object such as a fire hydrant, mailbox, or parking meter
- Hit-and-run damage , i.e. when the culprit flees without rendering assistance. It even applies to damage done in parking lots.
- pet injuries
Medical payments coverage
This coverage covers medical care and treatment expenses for you and anyone in your car at the time of an accident, regardless of who was at fault.
Again, the items covered will depend on your state. This coverage may only cover damage related to medical treatments or it may be broader and protect against personal injury, check what your state requires.
Medical bills coverage can cover:
- Medical bills for you and those covered by your policy;
- Salaries that will not be received if you or your passengers are injured and unable to work;
- Household services such as day care, house cleaning or gardening that someone injured in the accident cannot do;
- Disability and rehabilitation costs
- Death benefit paid to your family if you or a passenger is fatally injured in an accident
- funeral costs
This cover also protects you if you get hit by a car while walking, skating or cycling.
Bodily injury and property damage to uninsured or insufficiently covered drivers
Uninsured/Underinsured Motorist Bodily Injury (UIM) and Property Damage (UMPD)
If your car is damaged in an accident caused by an uninsured or underinsured driver, this coverage ensures that your car is restored. If, in addition, you or your passenger are injured, your medical costs will also be covered.
It’s not enough to get hurt, have you ever thought if on top of everything you still have a hospital bill for an accident you didn’t cause?
Other optional coverages
There are still other types of coverage to suit your needs.
You can get car rental reimbursement, coverage for custom parts that we know are often worth more than the car, and stress-free tow truck calls.
Soon, we will talk more about this.
Auto insurance exclusions
It’s important to know what the standard insurance exclusions are so you can opt (or opt out) of broader liability coverage that meets all your needs.
- personal injury and property damage intentionally caused by you;
- damage to property owned or transported;
- damage to rental property used by you or in your care;
- liability arising from the operation or ownership of a vehicle used as public transport or livery , such as a taxi (does not apply to carpooling);
- use of a vehicle without permission (does not apply to family members who live with you);
- motor vehicles with fewer than four wheels or designed for off-road use, such as golf carts;
- vehicles used in prearranged races or speed competitions.
What if I need to leave my state?
When you drive your car out of state, your auto insurance policy adjusts to meet the financial responsibility requirements of other states. Incidentally, it also conforms to other state laws, relating to you – alleged out-of-state driver – when your car is being driven in another state.
While you are temporarily driving in another state, your liability coverage will pay the higher amount:
- Limits of the insured’s liability policy
- The other state’s minimum liability requirements.
Simulate or review your auto insurance
If you already have a car and have already taken out your insurance, the advice is: review your insurance ! We have a habit of going on autopilot and not paying attention to details. Now that you’ve seen all the coverage possibilities, are you still sure your insurance will meet all your needs?
Or has your life changed, your habits changed, and you have more coverage than you need? Take your review and you could reduce your prize value by up to $100!
If you don’t have insurance for your car or you’re still thinking about which car to buy, do your simulation now , it doesn’t cost anything and you can already include the right amount in your budget.