What is insurance policy

  If you lease a car, you'll still need to purchase your own   state-mandated basic auto insurance —and you'll very likely need additional coverages: Your leasing company will require collision and comprehensive auto coverage The bank, leasing company or other entity that is financing your leased car has a monetary stake in the vehicle. They’ll want to make sure there are sufficient funds available to repair the car in the case of an accident. For that reason, you'll need to buy: Collision insurance  to cover the damage to your leased car from an accident with another automobile or object. Comprehensive insurance  to cover a loss to your leased auto caused by something other than a collision, such as a fire or theft. You'll likely be paying for gap coverage (though you may not know it) After a new car comes off the lot, its value depreciates quickly. If your leased car is damaged beyond repair or totaled in an accident, there likely will be a difference between the a...

  The amount you'll pay for car insurance is impacted by a number of very different factors—from the type of coverage you have to your driving record to where you park your car. While not all companies use the same parameters, here's a list of what commonly determines the bottom line on your auto policy. Your driving record  – The better your record, the lower your premium.  If you've had accidents or serious traffic violations , it's likely you'll pay more than if you have a clean driving record. You may also pay more if you're a new driver without an insurance track record. How much you use your car  – The more miles you drive, the more chance for accidents so you'll pay more if you drive your car for work, or use it to commute long distances. If you drive only occasionally—what some companies call “pleasure use"—you'll pay less. Location, location, location  – Due to higher rates of vandalism, theft and accidents, urban drivers pay a higher auto ...

  The vehicle you own, your personal priorities and your budget all factor into your unique auto insurance needs. Before comparing policies and insurers, evaluate how you use your car and what risks you face to figure out what options make the best sense for you. 1. How much do you drive? Do you absolutely need your car every day—for instance, to commute to work or drive the kids to school and activities? Do you drive 100 miles a month or closer to 1,000 or more? Make sure your policy reflects how much you use your car. If you don’t drive a lot, you may want to opt for mileage-based insurance. 2. Will you be using your car for work? If you use your car not just to get to work, but to perform tasks for which you get paid, commercial auto insurance is a necessity. A personal auto policy will not provide coverage if you transport paying passengers through a ride-share service, deliver pizzas, drive as a courier or use your car for other commercial activities. 3. What type of car do yo...

  Once you have a   clear picture   of how you use your car and your priorities, you’re ready to shop for insurance. Generally, it’s a good idea to compare policies from at least three different insurers. You’ll want to consider fundamental factors such as coverage and price, but it’s also worth evaluating prospective insurers as well. The following are the most important factors to consider. Types and amount of coverage Try to compare apples to apples when choosing your insurance policy. All of the policies that you review should have the same types and amount of coverage. It is difficult to compare policies, for instance, if one provides $50,000 in property damage liability coverage, another only $30,000, and a third $100,000. Coverages that you’ll want to consider, though some are optional, include: Primary liability—including bodily injury and property damage coverage Medical payment coverage Uninsured motorist coverage Collision Comprehensive Check prospective polici...

  Basic personal auto insurance is mandated by most states and provides you with some financial protection in case of an accident. But is it enough? What are the options? Learn how car insurance works and what types of coverage are available. Understanding auto insurance—the basics Auto insurance is a contract between you and the insurance company that protects you against financial loss in the event of an accident or theft. In exchange for your paying a premium, the insurance company agrees to pay your losses as outlined in your policy. Auto insurance provides coverage for: Property  – such as damage to or theft of your car Liability  – your legal responsibility to others for bodily injury or property damage Medical  – the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses Basic personal auto insurance is mandated by most U.S. states, and laws vary. Auto insurance coverages are priced individually (a la carte) to let you customiz...