There are five common types of insurance that are available on most automobile policies. However, the types of auto insurance you will be required to purchase can vary considerably depending on where you live. Currently, in California, only three of these are necessary. While each of these types of insurance may not be mandatory, you should know what is available so you can decide how much coverage you need for your vehicle.
Five Common Types of Auto Insurance
There are five common types of insurance offered for most automobile policies. However, the types of auto insurance you will be required to purchase can vary considerably depending on where you live. Currently, in California, only three of these are necessary. While each of these types of insurance may not be mandatory, you should know what is available so you can decide how much coverage you need for your vehicle.
Liability coverage protects you when you cause an accident. In many situations, the “at fault” driver is legally required to cover any expenses that result from the accident. Specifically, this usually includes any medical bills, property repair fees, or legal fees that the other people involved in the accident acquire. The vast majority of states, including California, require all drivers to have a minimum amount of liability coverage. Currently, all Orange drivers must have body injury liability coverage for $15,000 per person/$30,000 per accident. You must also have a minimum of $5,000 of property damage liability coverage.
Collision coverage pays to fix your own vehicle when it is damaged in an accident. Typically, collision coverage only applies to accidents where your car collides with another vehicle or object. Ladera Ranch, CA drivers are not required to carry collision coverage; however, you may be required to include collision insurance on your auto insurance if you finance or lease a vehicle.
Comprehensive coverage also covers repairs to your own vehicle. Unlike collision insurance, comprehensive insurance pays for damage that comes from something besides a car accident. For example, if a tree limb falls on your parked car, a comprehensive policy would pay for the damage. Like collision coverage, Orange drivers are not currently required to carry comprehensive coverage, but you will likely need it if you lease or finance your car.
When you add personal injury protection to your auto insurance policy, it pays for any medical expenses that you, the policyholder, incur after an accident. Remember that this protection only extends to you. If you are found at fault, your liability insurance will cover the injuries of anyone in any other vehicle as well as your passengers. Once again, personal injury protection is not required in California. Still, it’s a type of protection every driver should consider adding to their Ladera Ranch car insurance policy, so they are fully protected.
The final main type of auto insurance is uninsured motorist coverage. This coverage pays for any vehicle damage and medical expenses if you are involved in an accident with someone who is uninsured. While uninsured motorist coverage is not required everywhere, all Ladera Ranch, CA policies must cover a minimum of $3,500. This is the only requirement that can be waived, but your auto insurance company is legally required to offer it to you, and they must obtain a signed statement that you were offered the coverage if you choose not to carry it.
What Auto Insurance Doesn’t Cover
Your auto insurance doesn’t pay for routine maintenance or any damage that results from normal wear and tear. It also doesn’t pay for intentional damage. Your auto insurance policy does not cover damage or theft of personal items. If valuables are stolen or destroyed in an accident, they will not be covered even when you have comprehensive coverage. You might be surprised to learn that this also includes added accessories in the cabin of your vehicle—items such as radios, computer/smart systems, or DVD screens. Finally, your auto insurance will not cover your car anytime you are using it for business purposes. This includes official errands that you might have to run while you are “on the clock.” This means that you or your employer will need to purchase commercial vehicle coverage.
Factors That Affect Auto Insurance Costs
Each car insurance quote is tailored to the individual driver. This means that no two people will pay exactly the same rate for the same types of coverage. There are several factors that an insurance company takes under consideration when they provide a quote on a policy. These factors include:
The single biggest factor that affects young drivers is age. Most of you have likely heard that insurance rates go down after you turn 25. In most cases, this is true because statistically, drivers over the age of 25 are involved in fewer accidents.
How to Reduce Your Risk Factors
If you want to reduce the overall price of your auto insurance, you will want to consider your risk factors. While you can’t do anything about your age or gender, there are some factors that you can control. For example, by keeping your annual mileage to a minimum, maintaining a good credit score, and preventing negative events on your driving record, you can reduce your risk factors and lower the final price of your policy.
Picking the right auto insurance policy is important for all young drivers in Ladera Ranch, CA. Driving without adequate insurance can hurt your finances and your credit rating. It can also be illegal. Cost is an issue for many young drivers, but it can easily be controlled by doing a little research and comparing insurance companies.
Are you a young Orange driver ready to purchase your first auto insurance policy? At Southland Auto Insurance, you will find expert agents that understand the California auto insurance requirements. Call us today at 888-823-8682 to discuss your perfect auto insurance policy. Auto insurance can seem confusing, but it doesn’t have to be. You can also visit our website at https://www.southlandautoinsurance.com for answers to all of your insurance questions.