Auto Insurance – Legal requirements and benefits
Auto Insurance
In many countries, it is mandatory for all motor vehicle owners to buy an auto insurance policy. It is in the greatest interest of the general public and for the safety and security of the people including the vehicle owner as a vital member of the society. Auto insurance policies are issued by insurance companies to protect people against public liability claims in the event of any kind of road accident. If you choose to drive without having a motor insurance policy you may end up with heavy fines, suspension of your license and even forfeiture of your vehicle.
You may face catastrophic incidence anytime in life especially when you are on the roads driving, you need an insurance company to protect you from the financial loss and hefty claims. In the event of accidental death, loss of vehicle or damage, property damage, collisions or accidents from a rented car, an auto insurance policy provides protection to the driver against insane damages claim sometimes in millions of dollars.
There are two types of auto insurance policies you can buy. The Act Only Policy, also known as the basic coverage, and the Comprehensive Policy. The Act only policy or the basic policy provides basic coverage and is about the payment of compensation to third parties (affected person or legal heir) for death or any bodily injuries or damage to the property. In the case of Comprehensive Policy, the policyholder takes care of his interests as collateral security. The Comprehensive Policy covers compensations against theft of vehicle, fire or both, external damage to the vehicle in case of accidents, riots, strikes, torching, explosion, self-ignition, burglary, housebreaking, malicious acts and terrorist acts, natural disasters such as earthquake, flood, cyclone, inundation, land/rock slides etc. loss of vehicle or damage while in transit by road, rail, air, inland waterways, lifts or elevators.
The insurance holder may avail discounts if he decides to exclude natural disasters such as earthquakes, floods, cyclones, land or rock slides etc. or public acts like riots and strikes.
Benefits of Auto Insurance
If you are in an accident and injured, no matter who is at fault, accident benefits coverage, as required by law, provides supplementary medical care, rehabilitation, and income replacement support as well as your attendant care during your recovery period. If you cause an auto accident in which other person or people are killed, injured or the property is damaged your auto insurance protects you against death compensation claims, bodily injury liability, property damage liability, medical payments etc. If your car is damaged you may get it repaired at the top repair facility or get a brand new replacement if it is badly damaged.
Every auto insurance policy is designed for specific needs and comes with standard coverage and features to protect you from financial losses, to fulfill legal requirements and to reduce your worry in the event of an accident or a claim. Therefore, it is always advisable to abide by the laws and buy an auto insurance and drive safely.
