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What Every Driver Should Know About Their Insurance Policy

T

here were around 100 cars on the road in the United States when the first automobile insurance policy was purchased. In 1898, the vehicle of choice was horse and carriage. The main concern of both insurers and automobile drivers was the injury those noisy machines might inflict on horses.

Obviously, things have changed. Auto accidents injure people every 14 seconds. Every 13 seconds, a car accident kills someone. That adds up to 31 million accidents every year.

With around 160 million registered vehicles on the roads today, automobile insurance is the most widely purchased of all liability insurance available. However, few drivers are knowledgeable about the specifics of their policies.

Letís start with the most basic fact: policies are priced differently, according to the level of risk each driver poses. Insurance companies group drivers into categories based on the loss incurred by the insurer:

        Sex: men statistically have more accidents than women

        Age: drivers under 25 are considered more at risk for accidents

        Marital Status: married drivers tend to have less accidents

        Personal driving record: accidents, speeding tickets, and drunk-driving offenses factor into your risk percentage

        Use of vehicle: commuting at rush hour puts you at greater risk for accidents than the occasional driver. Drivers whose vehicles are necessary for their work are at the greatest risk.

        Type of vehicle: value, size, weight, age, and cost of replacement parts all figure into determining the price of your policy. Larger, heavier vehicles are considered a lower risk than smaller, lighter ones. Additionally, the more expensive the car, the costlier the repair, the high the insurance premium.

After you have an auto accident, contact your insurance agent as soon as possible. An insurerís claim adjuster who will evaluate damages and injuries will then contact you. Compensation for auto repairs and medical expenses is immediate, and the process is uncomplicated. Not so for determining liability. The adjuster commences the settlement process, but the length and difficulty will depend on the cooperation of the other involved party.

You are not required to accept the first amount offered if it does not meet the cost of your repairs or recovery. If that is the case, it will be well worth your time and energy to do a lot of research in order to prove that your reported loss is valid ó your insurance company is required to honor the provisions of your policy.

Try to separate the business of negotiation from the shock and emotional impact of your accident. Your goal is to settle on a monetary amount that is fair to both you and your insurer.

Drunk driving offenses are considered extremely serious, not only in terms of the law and the loss of life, but also in terms of your insurance company. First, be aware that a DUI offense remains on your record for ten years. If you are found guilty, there are serious consequences, set by the state you were arrested in. These penalties often include the revocation of your license for a period of time determined by a number of factors, including past offenses, fatalities, and the level of your BAC (blood alcohol level).

While it is true that many insurance carriers only check driverís records every one to three years (so it is possible for your DUI to go unnoticed), most states now require DUI convicts to obtain what is called a SR-22 certificate from their insurers. Then a number of things may happen: your insurance company will most likely raise your premiums and label you a high-risk driver. They may decide to cancel your policy. If so, you will then have to obtain insurance with a cancellation on your insurance history. Even if your insurance company misses your DUI at first, the company has up to three years in most states to cancel your policy or raise your rates.

Finally, speeding tickets, traffic violations, or ďpointsĒ can affect your insurance rates. The good news is that there is a good chance your insurer wonít find out, particularly if you received the ticket out-of-state. However, it is considered quite serious if you intentionally attempt to deceive an insurance company by leaving convictions off an application. You may be charged with fraud, and your policy will most likely be cancelled. This means that on future policies, your rates may rise dramatically. Now letís draw some conclusions. After reading this article, this should be fairly simple:

 

        DRIVE CAREFULLY AND DEFENSIVELY

        If youíre in an accident, FIND OUT ALL YOU CAN ABOUT YOUR INSURANCE POLICY.

        DONíT SPEED or DISOBEY TRAFFIC LAWS

        DONíT DRINK AND DRIVE.

One last thing to remember: driving can be fun, so donít forget to have great trip!

This webpage is brought to you for general information purposes only and there are no warranties as to accuracy, completeness, or results obtained from any information posted on this or any linked website.


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