Car Insurance -- Clarifying It

By buying a car insurance policy, you are entering into a contact with the insurance company. Under the contract, the insurance company agrees to pay your losses if your car meets with an accident. Your part of the contract is to pay the premium.

Car insurance provides property, liability and medical coverage. In case of damage to or theft of your car, property coverage will pay for the losses. If you car causes bodily injury or property damage, the liability coverage pays for your legal responsibility.

The medical coverage will pay for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.

Majority of the car insurance policies are valid for six months to a year. When the validity is over, you must renew the policy.

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 varies from state to state. Some states impound your car. Some states impose heavy fines. Serious trouble. That's what's in store for you if your car is involved in an accident with insurance. You will have to pay out of your own pocket for any injuries or damages.

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. There is evidence to show that married people are a lot more stable than their unmarried counterparts. This makes them more careful on the road and, therefore, a better risk to insurers. They generally file fewer claims and when they do, they usually cost less.

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2. "Pimping your ride" does NOT help if you want lower rates. If you want to impress your friends with those extra special features like bigger types than the manufacturer's specification, then be prepared to pay a lot more.

3. It's easy to save a few hundred dollars on a home but lose thousands over the years on auto insurance because of its location. Also note that a neighbor not too far away might fall under a lower crime zone than you -- This affects rates.

So, as part of your home shopping activities, check how this neighborhood will affect your auto insurance rate. 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. The only easier thing for a thief would be if you handed over your keys as a gift. Car thieves are known to go for easy targets. And what could be easier than a car that's ready to be driven away -- It takes just seconds.

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

There are two things you must do for this to be possible: The car must be registered in your parents' name and you must live with them. If you do not like the idea of handing the car's ownership to them and other stuff that may come with it, then you'll have to forego this option.

6. Visit not less than five insurance quotes sites. Using a minimum of five quotes sites raise the chances that you would obtain cheaper auto insurance quotes. This is because offers not represented by one site would be represented by the other.

Moreover, you know that since your chances of getting lower auto insurance quotes is proportional the range of quotes you receive, the more insurers you get quotes from, the brighter your chances will be.

Getting your auto insurance quotes online will help you save a bundle if you sacrifice just 25 minutes to obtain quotes from a minimum of five insurance quotes sites.