Car insurance is essentially insurance for automobiles, trucks, motorcycles, or any other vehicle on the road. Its main purpose is to offer financial protection to individuals against physical and financial damages resulting from car accidents and from personal liability which may also arise due to accidents at an automobile. Car insurance policies vary from company to company.
Car insurance policy must be carefully purchased and taken out in accordance with the need of the individual. If you have just bought your car then there is no need to get yourself confused about what type of insurance coverage you need. In case you have a good driving record and good credit rating, it is better to go in for a no-claims bonus which is an insurance premium that covers any claims in the event of damage due to theft, vandalism, accident, etc. A claim will automatically be covered under this policy and it is the best possible way to reduce the risk of losing any money from a car crash.
It is important to note that a car insurance policy is completely different from a vehicle liability policy. Vehicle liability policies are available for those who would like to insure their vehicles against a certain category of accidents. These policies are normally more expensive than car insurance policies as compared to auto insurance policies. This is because they are aimed at protecting vehicles from losses and damages resulting from car accidents and also from accidents that may arise due to negligence on the part of the owner.
Another type of car insurance is referred to as Comprehensive or Fully Comprehensive policies. These policies cover various types of accidents such as collision, bodily injury, theft, vandalism, etc. In fact, comprehensive policies are actually an amalgamation of various types of policies as mentioned above. The only difference between fully comprehensive and the other type of policies is that fully comprehensive policies cover all damages caused to the vehicle and also include losses incurred due to theft, vandalism, etc. While fully comprehensive policies are suitable for those who own very expensive cars and do not want to take their car off the road or else suffer any losses from such incidents. However, the fully comprehensive policy is usually more costly than the other types of policies.
The third type of policies is the liability insurance which mainly includes medical payments, loss of wages, etc as an incident to any claim made by the victim for an injury or loss caused by the defendant due to the fault of the insured. The liability insurance premium also takes into consideration the type of vehicle you have for your car. Liability insurance policies are quite expensive than the other types of car insurance policies due to the fact that the insurance premium is calculated based upon the cost of the damage done to the car and the risk factor of the vehicle involved in the accident.
Car insurance policies have the responsibility of providing an amount that pays for any damages that may occur to you or your vehicle, irrespective of who is to blame for the accident. They are generally purchased in the name of the individual to make sure that the amount paid is recovered from the guilty party, as well as they pay for any medical bills incurred due to injuries incurred during any accident.