What is the best car insurance to buy?
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Asked August 26, 2013
The exact type of insurance you are required to have is dictated by your state laws. To find out the requirements in your state, contact the Department of Motor Vehicles or your state Department of Insurance. Most states will require you have bodily injury and property damage liability; others use the Personal Injury Protection system. You may be required to carry some additional coverage if the car is under a lien or loan. Finally, there are some coverages that are entirely optional that could save you a lot of expense if something bad should happen.
Liability insurance is required throughout the United States, and covers the injuries and damages you cause to other people in an accident. This coverage does not include injuries or damages to you, your immediate family members, or to your property. Liability insurance is purchased in limit blocks, such as $25,000/$50,000, where the first number is the maximum limit for a single person or incident, and the second number is the upper limit for all damages or injuries you are responsible for in the accident.
If you are still paying on the car, you may also be required to carry collision insurance to pay for repairs to your vehicle, comprehensive coverage to protect against vandalism or single-vehicle incidents, and GAP insurance to cover the difference in cost between depreciated value and amount owed if the car is totaled in an accident. Once the vehicle is paid off, GAP insurance is unnecessary, and collision and comprehensive coverages become optional.
Some car insurance coverages are entirely optional. This includes rental car reimbursement, towing, and roadside assistance. Another option that will cost a little more but is worth having is to convert your typical Actual Cash Value policy to a Full Replacement value policy that will completely pay for repairs or replacement rather than paying a depreciated amount. If you carry high valued equipment or property, you might also consider increasing the personal property limits of the policy or purchase a separate policy to cover your frequently transported valuables.
Read about getting cheaper car insurance rates.
Answered August 26, 2013 by Anonymous