Car Insurance -- Explaining Things

When you buy car insurance, you enter into a contract with the insurance company. Under the contract, the insurance company agrees to pay your losses if your car meets with an accident. Your part of the contract is to pay the premium.

Car insurance covers property, liability and medical coverage. Property coverage pays for damage to or theft of your car. If you car causes bodily injury or property damage, the liability coverage pays for your legal responsibility.

The cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses are taken care of by the medical coverage.

Most car insurance policies are valid for six month to a year. When the validity is over, you must renew the policy.

State laws mandate that your have some form of car insurance if you own or operate a car.

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The penalty for driving a car without insurance is different in different states. Some states impound your car. Some states impose heavy fines. Serious trouble. That's what's in store for you if your car is involved in an accident with insurance. You may have to comply with the financial responsibility laws including having to pay for any injuries or damages out of your own pocket.

The insurance company will consider your credit history, the age and type of your car before offering you a rate.

As the owner of a car, you are responsible for providing insurance for the car, no matter who is operating the car. If you operate a car without insurance, you will be in violating the law.

Finally, a few savings tips...

1. Getting married will bring down your rate by a huge margin. Insurers have statistical data that show that people are less reckless and much more careful on the road when they get married. Furthermore, as a group, their claims are usually less both in number and average cost per claim.

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2. "Pimping your ride" does NOT help if you want lower rates. If you want to impress your friends with those extra special features like bigger types than the manufacturer's specification, then be prepared to pay a lot more.

3. It's easy to save a few hundred dollars on a home but lose thousands over the years on auto insurance because of its location. Also note that a neighbor not too far away might fall under a lower crime zone than you -- This affects rates.

So check with your agent before you commit to a new home. This doesn't come readily to mind when you're shopping for a new home. Does it?

Since you may live in the same home for decades to come, a difference of $200 in auto insurance rates would amount to thousands over the years.

4. A lot of folks have lost their cars in the short seconds that they took to dash inside to get something while leaving their cars running and unlocked. Don't make this mistake. This is an open invitation to any thief sniffing around. Car thieves are known to go for easy targets. And what could be easier than a car that's ready to be driven away -- It takes just seconds.

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5. Using your parents' auto insurance policy is an alternative for you an under 25. If you are of driving age, then your parents certainly are far above twenty five years which means they're lower risk drivers.

There are two things you must do to make this possible: The car must be registered in your parents' name and you must live with them. If you do not like the idea of handing the car's ownership to them and other stuff that may be attached to that, then you'll have to forget this alternative.

6. You will save a lot of dollars by visiting a minimum of 5 quotes sites. If you do this, you will be able to get the lowest California auto insurance quotes available since five sites will return up to 25 quotes altogether.
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