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Many times people ignore the insurance coverage while buying a car considering auto insurance as an aspect which will increase the financial burden. However, buying car insurance is important as it significantly reduces the financial burden caused by an accident or property damage.
Most of the people have very little knowledge about their insurance needs. By law, car insurance must meet certain minimum requirements in order to be considered valid. The primary coverages included in car insurance are liability coverage, personal injury protection, medical expenses, death benefit, property damage liability, uninsured/underinsured motorist coverage, comprehensive coverage and collision coverage. Each state has different requirements regarding these coverages. Understanding these coverages can bring down insurance costs significantly.
Liability insurance coverage is mandatory under most state jurisdictions. Liability insurance provides coverage for injury caused to the person driving the car. It also provides coverage for people injured and property damaged during an accident. The minimum amount required for liability coverage varies from state to state. However, in states such as New Hampshire, Tennessee, South Carolina and Wisconsin, liability coverage is not an obligation.
Some states require insurance policies that provide personal injury protection and also cover all medical expenses incurred at the time of treatment. There are also policies available that provide financial coverage for any lost wages if the insured is injured in an accident. It is always wise to choose a policy that includes a death benefit option, so that in case of an unexpected death of the life assured during an accident, the policy provides financial security to the family.
Collision coverage covers any vehicle damage caused by a collision. Comprehensive coverage covers issues such as theft, fire and falling objects, missiles, explosions, earthquakes, floods and riots.
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