What Do I Need to Know About Auto Insurance?

Figuring out which type of auto insurance is best for you can be overwhelming. With so many options, where do you even start? Here are four factors to consider when deciding on the insurance plan for you.

Basic Requirements

When it comes to auto insurance, there are some basic requirements that you need to be aware of. First off, every state has different amounts of coverage that you must have to be legal. For example, in California, you must have at least $15,000 of liability insurance coverage. Other states may differ.

The reason states have these coverage requirements is to protect other drivers in the case of an accident. Liability insurance on its own is not enough. Once you’ve purchased liability insurance, there are more types of auto insurance you should invest in to protect yourself and your vehicle.

Coverage Types

The three most common types of auto insurance coverage are liability, collision, and comprehensive. It’s important to understand what these all cover to decide which types of coverage you need.

Liability insurance is the most basic and most expensive form of insurance. It covers damages sustained to another party in an accident. You need to have some level of this type of coverage no matter where you live to protect others on the road. It’s important to note that this type of coverage does not protect you or your car.

Collision insurance covers you and your vehicle in the case of any type of collision. For example, this could be between you and another car, a wall, or a pole. This coverage will cover the expenses to repair your car. In most cases, this coverage will also pay for the cost of replacing your car if it was totaled.

Comprehensive insurance covers non-accident related damage to your car. This type of insurance applies in situations when natural elements damage your car. For example, this covers any damage that occurs if a tree falls on it. This also covers vandalism and car theft. But, this type of insurance does not cover you in any type of accident.


An important step in selecting the right insurance for you is researching how you will receive compensation in the case of an accident. The types of compensation will depend on both your coverage level and what happened in the accident.

If you have premium coverage, you will receive coverage for more things. For example you could receive compensation for damages to both your car and your body. You may also receive compensation for any lost wages that resulted from not being able to work because of the accident. It’s also possible to receive compensation for any family members’ deaths.

Factors that Affect Your Rate

When you’re shopping around for car insurance, you’ll want to be aware of different factors that may affect your insurance rates. At the base line, insurance companies are trying to figure out how risky of a client you will be. Will they make money off you, or will they lose money off you?

When you understand that this is at the base of what insurance companies are looking for, it will change how you anticipate your insurance costs. Be aware of some of the main factors that all insurance companies look at. They look at things like your age, your driving history, the car you drive, and your personal credit history. If you feel like you might not excel in one of these categories, there are ways to offset any extra costs.

For example, even though insurance to cover a teenager tends to be more expensive, you can get discounts based on whether the teenager has gotten good grades or taken defensive driving courses.

As you’re thinking about the right insurance plan for you and your car, start with a basic understanding of how car insurance works. It’s important to understand what you’re getting, especially if you have a luxury car. You’ll want to make sure you get the right amount of coverage. Be sure to think about any other specific factors that may affect the type of insurance you need to find the best fit.

Before you get auto insurance, you’ll of course need a car. See what we’ve got in our inventory!


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