The auto insurance is both essential and mandatory, as well as the home insurance (except for the owners). We note an increase in the number of uninsured motorists on the roads. So why is auto insurance mandatory? Can we manage to drive our vehicles without having our vehicles insured? All the questions will be explained in this article. So let’s get started.
Auto Insurance: How does it Work? Why is it Compulsory?
The government acknowledges that anyone who uses or drives a vehicle is liable for harm made to a third party; this harm can be physical or mental in nature. To defend themselves (particularly financially), drivers are consequently required to bring out car insurance. It is a contract generally signed for one year, tacitly renewable.
The price of auto insurance can vary from one insurance company to another insurance company; for instance, you can find the best deals on car insurance on www.generalinsurance.com. Now, this insurance price is calculated according to various criteria: the driver himself, the type of vehicle, its use, the main geographical area of circulation, the chosen cover. There is also a scale that rewards or financially sanctions the driver according to the number of accidents.
Auto Insurance: Mandatory Guarantees and Optional Guarantees
If the car insurance is compulsory, the motorist can – if he wishes – add options. Let us first see that they are compulsory guarantees. The motorist must at least take out civil liability. RC protects third parties against damage (physical or material), whether it is another driver or family members in the responsible vehicle.
Liability does not protect the driver himself. However, it is possible to take out an “individual driver guarantee,” this time covering any personal injury suffered by the responsible driver.
The motorist can also add optional guarantees, such as the damage guarantee. This is to ensure the vehicle itself, to cover the damage suffered by the latter. If this guarantee is optional, it is nonetheless essential, if only financially. The vehicle can be insured by a third party or “all-risk”.
Finally, the motorist can opt for additional guarantees covering other risks such as theft, fire, natural disasters, etc.
Auto insurance: In the Case of the Accident
Driving without insurance can have very serious consequences for the driver in the event of a responsible accident. An uninsured driver responsible for an accident will never be compensated for his own damage, whether material or bodily.
The other victims, including the possible passengers of his vehicle, will be taken in charge by the Guarantee Fund, which will compensate all of their damages: treatment costs, physical after-effects, suffering, need for humanitarian aid, loss of income, etc.
But as soon as it compensates a victim, the Guarantee Fund turns against the uninsured manager to recover the sums paid. If replacing a crumpled fender in a car is not very expensive, bodily injury, on the other hand, can represent sums that the uninsured will take many, many years or even a lifetime to reimburse. A debt that he also risks passing on to his heirs.
Only the responsible driver is not compensated. The other people involved in an accident are compensated either by the insurance company of the responsible motorist or by the damage guarantee fund if the person responsible is not insured
Despite the fact that it is mandatory to drive with insurance in our country, less than 30% of drivers have one, according to the National Commission for the Protection and Defense of Financial Service Users. Being saving the main reason why people do not hire one. While you don’t buy a car thinking you are going to crash, the possibility is latent from the moment you touch the street, and it is better to be prepared not to get hit directly in the wallet.
Thanks to the internet, we have access to many, and increasingly, insurance companies and pages where you can get a quote in real-time on the offers that are available. The objective is that the user can choose a plan that fits his needs. In some companies, they have promotions directed to the payments of deductibles, an extra element to look for that this becomes of the culture of insuring their car. There is also the option to add to the monthly payments of a car the price of insurance; this is the case if you are buying a new car or take it out on a lease.
The most important thing when choosing insurance is to look in detail at the services it offers, its prices, and what coverage it has. You should also verify that the policy guarantees Civil Responsibility, which is the coverage required by the traffic regulations because it protects third parties and their property.
There are two types of coverage: limited and broad. The difference is that the first may or may not cover the theft of your car and that the second may cover more specific damages. Choose the one that best suits your needs.
With that, we can conclude that when a person takes a lifetime decision of buying or owning a car. He or She must not avoid the fact that the safety of the car, as well as his own, should be his first priority. The auto insurance provides all kinds of safety to you so that you can live peacefully with the dream car of your own without worrying much about any risk.