Informed Citizen: Auto Insurance

So you just got your first car, and whether it's a brand new sports car, or a gently used minivan, you're probably pretty proud of yourself. Auto insurance is a crucial part of owning a car. It may seem a bit confusing, but really it's not complicated at all. I'm Justin, your informed citizen, and I'm here to make sure you are covered. If you own and drive a car, the law says you have to have some form of auto insurance. How much and what type varies from state to state, but regardless of what the law says, you need to be insured, because if you get to an accident, it can be very costly business. What exactly does auto insurance cover? Well, lots of things, from vehicles, to property, to physical bodies. There are six types of coverages, some that are required, and some that are optional. Let me break it down for you. If you injure someone in an auto accident, not only will you feel really bad about it, but you'll also be responsible for paying for their medical bills. That's where bodily injury liability comes into play. Now, you'll probably want to get more than the minimum required by state law, because if you get sued, you're going to need to be protected. Remember, some people in this country really love going to court. Of course, if you get in an accident, you might be the one who gets injured, so that's where you need personal injury coverage. This will cover your medical bills, lost wages, and sometimes even, heaven forbid, funeral costs. Chances are, even if you avoid hurting yourself or someone else in the accident, the car you hit is probably a bit worse for wear. Property damage liability covers you for damage to another person's car, or any other property you might have hit during your accident. This covers you for lampposts, fences, stop signs, the broad side of a barn, Of course, if you've crashed into something or flipped your car over, your vehicle is the one that needs to be repaired. That's where collision coverage comes in handy. Then again, damage to your car may be caused by something other than crashing into another vehicle or an object. You've got to contend with fires, falling objects, missiles, explosions, earthquakes, hail, floods, vandalism, riots, and run-ins with wild animals. So basically, comprehensive pretty much covers you in case you decide to drive through the set of an action-adventure movie. The final type of coverage is for people who won't see this video and are foolish enough to drive either with not enough insurance or with no insurance at all. With uninsured and underinsured motorist coverage, you're protected in case the person who hits your car can't pay for damages, or it's a hit-and-run accident. All right, that's all of them. I bet some of you had no idea there are so many types of coverages for your car. It's important to understand each of these so you can decide what coverages you need to best protect yourself. But don't try to sneak by with as little insurance as possible. At the very least, you should have a minimum of $100,000 of bodily injury protection per person and $300,000 of protection per accident. Oftentimes, accidents cost far more than the minimum required by most states. And remember, there are a lot of auto insurance companies out there, so do your research and find out who can give you the best deal and who has a good record of dealing with customers. Never choose on price alone. You need to make sure the company is financially stable and deals well with their customers. One of the best ways to protect yourself from getting involved in an accident is to make sure you're not distracted while driving. Recently, cell phone use and especially texting has become one of the greatest causes of accidents. Use some common sense, put the phone down, and drive. All right, I think you're ready to hit the road. To learn more about auto insurance, check out the Insurance Information Institute's website at www.iii.org Take care and drive safe.