If an accident occurs, it can cause severe injury or even death. Personal auto insurance protects drivers and their vehicles against financial losses associated with accidents.
However, personal policies generally exclude coverage for driving for business purposes — including commuting to work and running business-related errands. If you need to cover these activities, consider purchasing hired and non-owned auto insurance.
Cost-Effectiveness
If you cause an accident, auto insurance can pay for medical bills and other expenses. Without this coverage, you would likely have to pay out of pocket for those costs.
Having car insurance also enforces accountability on the road, as drivers are held financially responsible for the damage they cause. This may deter unsafe driving behaviours like speeding or road rage.
Numerous insurers provide savings that might lower the price of personal auto insurance coverage. For example, you can save money by taking a driver safety class or bundling auto, homeowners, or renters insurance with one company. You could also lower your rate by agreeing to e-bills and paying the entire annual or six-month premium upfront. Depending on your location, you can also get a discount by driving less, decreasing the risk of an accident. However, you will want to check with your specific insurer about mileage thresholds, as most companies have different rates at which they start giving discounts for low mileage.
Liability Coverage
One of the most important perks of car insurance is liability coverage, which pays other people for their medical expenses and property damage caused by your accident. Without this protection, you could be sued for damages that would deplete your savings and home.
Most personal auto policies exclude using a vehicle for business, such as commuting to work or running errands for your small business. However, some insurers offer supplemental car insurance products that cover this activity at an additional cost.
In addition, personal injury insurance, which will cover your medical expenses and any other car occupants, should be included in a decent liability policy. This benefit applies regardless of who is at blame in the collision. In addition, you can buy an umbrella policy that provides higher dollar limits on your core liability coverage. This is a great way to give yourself peace of mind and protect your assets.
Additional Coverage Options
Many insurers offer additional coverage options to boost your protection beyond the minimum required in most states. These could include personal injury protection, a feature of most health insurance policies that covers your medical fees and other costs regardless of who caused the event.
Other types of coverage that can be added to your policy include roadside assistance, which covers towing services, battery charges, fuel delivery, and locksmith help, among other things, and mechanical breakdown coverage, which helps pay for repairs or replacements on your car when it breaks down. The details vary by policy, so speak with an agent and read your contract carefully.
Another optional coverage is hired and non-owned auto insurance, which adds liability protection when you or your employees use a personal vehicle for business purposes. The specifics of this coverage, typically included in a commercial auto policy, can vary widely by state.
Customization
Unlike commercial auto policies, personal auto insurance allows you to customize your coverage with additional add-ons and options. This allows you to get the type of protection you want and need. You can adjust your policy limits, tailor your deductibles, and choose optional extras such as roadside assistance or rental car reimbursement.
In addition, personal auto policies typically have a higher limit on uninsured/underinsured motorist coverage and more coverage for damage to your vehicle caused by hail or other natural causes. Lastly, you can get endorsements to cover your vehicle if it is used for business purposes. This is a crucial coverage option for salespeople who drive a particular territory, regional managers who need to visit several stores, or contractors who work on job sites.
Auto insurance provides a safety net to help protect yourself in an accident or other covered events. With various discounts to make it more affordable and a team of professionals ready to assist with your claims, this type of policy is an excellent choice for all drivers.
