3 Ways Auto Insurance Protects You

Most states require you to carry some level of auto insurance to drive. While you may not enjoy paying premiums, insurance is important and helps you in many ways. If you would like to know more, keep reading.

1. It Pays if You Cause an Accident

If you cause a car accident, you can get sued for medical bills, lost wages, and pain and suffering. If you don't have auto insurance, you must pay out of pocket. If you have liability insurance (which most states require), the insurance carrier will pay for the expenses related to the accident.

For this reason, it's important to notify your insurance carrier about any accidents immediately. If you don't report the accident, your insurance carrier could drop you as a client. Even if you live in a state that does not require liability insurance, you should consider purchasing it because you can still get sued in those states.

2. It May Provide Money to You if You Caused an Accident               

Liability insurance won't cover the costs of your medical bills or damages if you cause an accident. However, if you have collision insurance, your policy will cover damages to the vehicle, even if you caused the accident.

If you have comprehensive insurance, the vehicle is also covered in the event of non-collision-related damage like hail and vandalism. If you're leasing or still paying off the loan, you may be required by the lender to have collision and/or comprehensive insurance.

You can also purchase medical pay coverage, which provides money for your medical bills related to an accident you caused. If you don't have medical pay coverage, you can still use your health insurance and/or PIP (personal injury protection) policy.

3. Some Policies Fight Depreciation

Gap insurance is a different type of auto insurance. It doesn't pay for medical bills or damages to the vehicle; instead, it protects the gap that forms between the value of the vehicle and the cost of the loan. Vehicles depreciate fast: so fast that you may quickly owe more than the car is worth.

This becomes a problem if the car is totaled. The insurance carrier pays out according to what the car is worth, which may not be enough to pay off the loan, making it hard to get a replacement vehicle.

Auto insurance is incredibly important because it protects you against lawsuits. Some policies may also cover you and have additional features. If you would like to know more, contact an auto insurance provider today.