Car Insurance -- Things You Ought To Understand

By buying a car insurance policy, you are entering into a contact with the insurance company. If your car meets with an accident, you will be eligible for compensation for the losses under the contract. In exchange, you agree 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 paid 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. In some states, your car will be impounded. Heavy fines are imposed in some states. If your car is involved in an accident without insurance, the consequences can be serious. You will be financially responsible for paying for any injuries or damages out of your own pocket.

Your credit history, the age and type of your car will play an important role in determining the rate you have to pay for car insurance.

You are responsible for providing insurance for any car you own regardless of who is operating the car. It is illegal for cars to be operated without insurance.

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. They generally file fewer claims and when they do, they usually cost less.

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2. If you want to keep your rates down, do NOT "pimp your ride." Doing such reduces your car's safety and, therefore, warrants higher rates as far as the insurer is concerned.

3. Before you get carried away with the few hundreds you will save on a house, check if it will not cost you much more in auto insurance. Homes in the same neighborhood may fall under different risk zones as far as your insurer is concerned.

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. The truth is that most people don't think about this when they are about buying a home.

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. If you must quickly get something inside, turn your car off, lock up and pocket your keys. Don't leave your car unlocked and running. This is an open invitation to any thief sniffing around. Remember, they look for easy targets. It certainly doesn't get easier for a thief than an unlocked car with a running engine.

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5. As an under 25, you can pay lower car insurance premiums if you use your parents' policy. The fact that you're of driving age means that your parents are of a lower risk age bracket.

You must remember that the vehicle must be registered in their name and you must be living with them if you want to take advantage of this option. This means that by law they own the car. If the benefits of "independence" outweigh your car insurance savings then this is definitely not an option for you.

6. Take out some time to visit not less than 5 insurance quotes sites that offer quotes on California auto insurance policies. It will take you around 25 minutes.

While you visit each site, ensure you give the same details. Doing otherwise will return misleading quotes. After you've obtained your auto insurance quotes, compare them to determine which serves your interest best in price/value.
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