Auto Insurance – 5 FAQs

Most consumers have questions about auto insurance — regarding coverage, requirements and options. Finding answers to the most pressing questions can help you to make better informed decisions about your car insurance.

Is it legal to drive without car insurance?

Nearly each state mandates that motorists carry at least liability insurance, which can cover the damage to people and property in case of an accident where you are at fault. Every state has financial responsibility laws as well that require proof of sufficient funds that show the state you are able to pay for insurance claims in the case of a bad accident. Without it, you need to buy the minimum state-required coverage.

I can’t find car insurance, what do I do?

You have two alternatives – purchase a non-standard insurer policy or a state-assigned risk pool. Non-standard insurers write auto insurance policies for motorists living in high-risk neighborhoods, those with accident history and high-performance car owners. Assigned risk pools are compile of local insurers who are required by state law to participate with a set amount of voluntary business that must legally accept motorists assigned to them – albeit with higher premiums.

What is minimum coverage?

State-required insurance covers your liability costs in regards to property damage and bodily harm, although specific coverage amounts will vary by state. Minimum coverage is bare-bones insurance. The Insurance Information Institute and your insurer will recommend better coverage – $300,00 accident liability coverage and $100,00 per person.

Are there differences between cancelation and nonrenewal terms on a policy?

You or your insurer may choose not to renew the auto insurance policy after expiration — if you find a cheaper policy or your insurance provider believes you’ve increased in risk. Wherein, cancelling refers to stopping services after 60 days of effective coverage. Insurers are legally able to revoke insurance if you’ve not paid the premium, fraud or suspension or revocation of a driver’s license. Canceled policies make it difficult to obtain future insurance, forcing you into buying an expensive high-risk policy.

Can I do anything if I am dissatisfied with my provider?

If you’re dissatisfied – tell your agent. If nothing is done, file a consumer complaint. Contact the State Department of Insurance if your problems are ignored. This department provides consumers with resources to help with your complaint or find you a new provider.

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