Auto
Insurance:
Vehicle insurance (also known as auto insurance, car
insurance, or motor insurance) is insurance purchased for cars, trucks,
and other vehicles. Its primary use is to provide protection against losses
incurred as a result of traffic accidents and against liability that could be incurred in
an accident.
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In the United States, auto insurance covering liability for injuries and
property damage done to others is compulsory in most states, though enforcement
of the requirement varies from state to state. The state of New Hampshire, for example,
does not require motorists to carry liability insurance (the ballpark model), while in
Virginia residents must pay the
state a $500 annual fee per vehicle if they choose not to buy liability
insurance. Penalties for not
purchasing auto insurance vary by state, but often involve a substantial fine,
license and/or registration suspension or revocation, as well as possible jail
time in some states. Usually, the minimum required by law is third party
insurance to protect third parties against the financial consequences of loss,
damage or injury caused by a vehicle.
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Vehicle insurance can cover some or all of the following items:
- The insured party
- The insured vehicle
- Third parties (car and people)
- In some States coverage for injuries to persons riding in the insured
vehicle is available without regard to fault in the auto accident (No Fault Auto
Insurance)
Different policies specify the circumstances under which each item is
covered. For example, a vehicle can be insured against theft, fire damage, or
accident damage independently.
Excess
An excess payment, also known as a deductible, is the fixed contribution you must pay
each time your car is repaired through your car insurance policy. Normally the
payment is made directly to the accident repair "garage" (The term "garage"
refers to an establishment where vehicles are serviced and repaired) when you
collect the car. If one's car is declared to be a "write off" or "total
loss"("write off" is commonly used in motor insurance to describe a vehicle the
worth of which is less than the cost of repair), the insurance company will
deduct the excess agreed on the policy from the settlement payment it makes to
you.
If the accident was the other driver's fault, and this is accepted by the
third party's insurer, you'll be able to reclaim your excess payment from the
other person's insurance company.
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