How Insurance Works

Insurance is one of those things that you never need until the moment that you need it desperately. For years, you might pay for car insurance without ever having an issue with your vehicle. You might go years without an accident and wonder why you pay for car insurance. But, when you are in an accident, you will be extremely happy to have insurance. This is true whether the accident is minor or severe. In this section, you can learn about the benefits of having car insurance. There are benefits to having car insurance even if you did not cause an accident. You can also learn how auto insurance works.

Types of Auto Insurance

Auto insurance is not created equally. There are a few different types of auto insurance that you might buy. A few of the most common types of auto insurance include:

• Liability Insurance. Many states require liability insurance by law. If you have liability insurance and you cause an accident, the insurance company will take on the damages. They will pay for the damages to the victim’s vehicle. This happens through the process of subrogation.
• Collision Insurance. Liability insurance pays for repairs to a victim’s vehicle. But if you have collision insurance, the insurance company will pay for repairs to your own vehicle. This is the case even if you caused the accident.
• Comprehensive Insurance. This type of insurance covers issues that might occur that are unrelated to an accident. This includes things like vandalism or theft of your vehicle.
• Personal Injury Protection. This type of insurance will cover medical treatment for the victim of a car accident. Paying for the victim’s medical bills yourself could be outrageous. It is very helpful to have your insurance company take on these costs for you.
• Uninsured Motorist Coverage. If you get into an accident that is not your fault, you deserve compensation. In most cases, the at-fault party’s insurance will pay your bills. But if the other driver does not have insurance, it will be difficult for your expenses to get paid for. If you have uninsured motorist coverage, your own insurance company will cover these costs. Your insurance company will cover the cost of repairs to your vehicle. They will also pay for your medical expenses.

Subrogation

Subrogation is the process where an insurance company takes on a person’s expenses. You pay insurance to protect yourself in an accident. If you cause an accident, the insurance company pays the victim of the accident. The insurance company becomes legally responsible for an accident through subrogation. This is why it is important to have car insurance.

Even if you do not cause an accident, it is helpful to have car insurance. This is because your insurance might cover issues that the other insurance company won’t. You can learn more about auto insurance in this section. Here, we discuss car insurance payments. We also talk about your coverage and what it means for your case. For more information, contact our office. We are happy to help.