What is covered under Car Insurance?

Car Insurance (which is also known as Motor insurance or vehicle Insurance) is a compulsory coverage which is bought for automobiles. It is a legal obligation one has to fulfill in order to drive a vehicle around across various states.  Recently I had mentioned how I brought my first auto-insurance for my new Chevy, here today I will discuss what all risks are covered under Car insurance. Please note all these clauses may not be there in your basic policy, and if not, then you can re-negotiate and get them included for better protection. Better protection means more premium and vice-versa so pay attention to every risk.

Basic risks covered in Auto Insurance

  • Medical expenses of Insured party: In case of an unfortunate accident, medical expenses of the driver as well as the owner are generally covered under car insurance. Here you should note that driver should be certified for driving the said car, otherwise instead of getting your claim you may instead land up paying penalty or fine!  
  • Physical damage to insured vehicle: This is the basic coverage you get with your auto insurance. While going for claim, you would be asked to narrate the whole event while led to the said damage to your vehicle. Based on your narration and report by an insurance surveyor you would be given claim. One thing you should note here is that some vehicular parts are not covered fully so read the policy well in order to avoid a rude shock. 
  • Cost to Tow the vehicle to the repair center: I know how costly and tough an affair it is to drag your broken auto from the middle of highway to a repair shop. Just check you may have your insurer billing you out in such a situation.
  • Third Party Liability: You get to insure various expenses you might owe to other party in accident, including physical and bodily injuries. Legal expenses too are taken care of. All the rash drivers reading this, getting third party liability covered must be on the top of your list.
  • Damage due to lightening, fire or theft (may or may not be covered).

Now some of the risks which are not usually covered under the policy, until and unless it is stated otherwise:

  • Loss due to depreciation: Auto as any other machinery loses its value over the years. So it would be na├»ve on our part to expect insurer to compensate for the depreciation in its value. 
  • Drunken driving or driving without proper license.
  • Mechanical/electrical breakdown or failure. 
  • Any damage beyond the geographical boundaries. Insurance policies are valid for specified (and stated) geographical area. In case any damage takes place outside the stated area, you won’t be able to avail benefits of your policy. 
  • Damage during wars.

Here I have listed risks which should be checked by everyone while browsing through various auto-quotes. Always remember a balanced policy will save the day for you, be judicious before selecting one.

You may also like to read :

Benefits of Buying Pay As You Drive Auto Insurance
Beginner's Guide to Insurance
Roles of Insurance


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