Car Insurance -- Things You Need To Understand

Car insurance is a contract between you and the insurance company. Under the contract, if your car meets with an accident, the insurance company must pay for the losses. 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. Your legal responsibility for bodily injury or property damage caused by your car is taken care of by liability coverage.

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

Most car insurance policies are valid for six month to a year. The policy must be renewed on expiration.

The law in all states require you to 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. Compounding of the car is done is some states. Heavy fines are imposed in some states. If your car is involved in an accident without insurance, the consequences can be serious. You may have to comply with the financial responsibility laws including having to pay for any injuries or damages out of your own pocket.

Your credit history, the age and type of your car are also vital factors in determining the rate you have to pay for car insurance.

It is your responsibility to provide insurance for any car you own regardless of who is operating the vehicle. If you operate a car without insurance, you will be in violating the law.

Finally, a few savings tips...

1. Although this may sound funny, you can bring down your rates by getting married. I know you won't get married just for this but when you do, it will save you a bit in auto insurance. It's commonsense that every person becomes more stable and less reckless once they get married. This stability affects such a person for good when he/she is behind wheels. Insurers will tell you that their records show that married people make fewer claims. Furthermore, when they do make those claims, they usually cost less on the average than those married by their unmarried counterparts.

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2. If you want to keep your rates down, do NOT "pimp your ride." Things like changing your tires to bigger ones than specified by the manufacturer, adding equipment that will increase your car's horse-power will cost you a lot more. So if you're really serious about keeping your rate down, leave your car the way it was manufactured.

3. Do you know that some folks are paying much more in auto insurance because of where their homes are? Do you know also know that homes within the same neighbor might actually fall into different risk zones according to the insurance industry's mapping?

Therefore, take your time to ask your agent what effect your new zip code would have on your rates before you make that down payment. I know: That isn't usually an issue when you're looking for a home but it's really important.

Remember, you might live in this home for up to 20 years or more. If its location makes you pay up to $200 more in premium, that will add up to $4,000 within that time frame.

4. Never leave your car unlocked and running while you dash in to get something. This is an open invitation to any thief sniffing around. Remember, they look for easy targets. An unlocked car with the engine running? What could be easier?

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5. A good option for you is to use your parents' auto insurance policy. Your parents certainly belong to a better risk age group.

You have to bear in mind, though, that the car must be registered in their name and you must be living with them if you want to use this option. This means that they legally own the vehicle. If the benefits of "independence" outweigh your auto insurance savings then this is certainly not alternative for you.

6. You will save a lot if you only have between 25-30 minutes. Visit, get and compare California auto insurance quotes from various quotes sites. The lowest offer should be what you go for easily.

Nevertheless, you have to look beyond just the lowest price to the best price to value ratio. The lowest priced may not be the best price/value for you as a person.
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