In the USA car insurance is something that everybody who owns a vehicle needs. And, in most states it is the law to have car insurance. The penalties for not having car insurance can be expensive and painful with the repercussions reaching far and wide. As most of us know, automobiles are expensive pieces of machinery, which means repair costs can be very high.
There are two forms of car insurance. The first is called comprehensive or full coverage and the second is called liability coverage. You need one of these types of insurance if you want to drive protected. Above all, car insurance will reduce your personal liability if something goes wrong. On top of protecting you, car insurance will also give you peace of mind knowing that you are covered. While prices vary, there are cheap auto insurance options available.
As mentioned above, there are two types of car insurance. Liability and full coverage. Liability is, as the words conveys, covers what you are liable for. If you are in an accident, this type of insurance coverage will only pay what you are liable for, such as the other party’s car you ran into. Because of state law, the owner of the car you ran into will also have insurance and should pay for the repair of your car. As long as both drivers involved in an accident have insurance, everything should be covered.
Now full coverage or comprehensive insurance is a coverage plan for people who do not own their cars. Banks who loan you the money to buy the car, demand that you have full coverage car insurance. This way, if their asset is damaged, it will be paid for. Generally, this means the bank will not take your house (or any other bank-owned assets) to pay for the debt you owe them. This is a system that, when is respected and followed, works well for all parties involved.
Basically, car insurance covers the debts you can’t pay. Even if you can, it’s a lot cheaper to have insurance. It’s a good idea to look at car insurance as a necessity, such as gasoline. The car should (and cannot!) not run without insurance. It can be financially debilitating to the owner of the vehicle. Remember, car insurance is your friend.