Auto insurance coverage is a very important thing to have. Most states
require you to have it before they will allow you to register a vehicle
or pay a great fee to decline coverage. In fact, if you show proof of
insurance and cancel it after registering your vehicle, then the
insurance company will tell the Department of Motor Vehicles and they
have the power to cancel your registration unless you show proof of
coverage again within 30 days. There is a very good reason for this,
which is why insurance on your vehicle is very important.
If you have an accident, whether you hit someone or someone hits you,
how do you think you would pay for the repairs? If you get distracted
and hit someone, you are responsible for the repairs for the other
vehicle. If someone hits you, they are the ones that pay for your
repairs. Some repairs end up costing a good $3000. If you end up
totaling your vehicle or another, then how would you pay for that?
Basically the repairs cost more than the value of the vehicle, and if
you have insurance coverage they usually pay for the vehicle's value
once it is declared totaled. If you have a loan on the vehicle, then
the insurance company will pay the bank the vehicle's value and if you
purchase the GAP insurance when you get the loan, that will pay the
rest of your loan so the bank will be able to release the title to the
insurance company and then you don't have to worry about paying a
vehicle loan that no longer have. If you don't have insurance on your
vehicle, then I would make sure to have a good $20,000 set to the side
for the emergency case. In most cases, it is a lot better for you and
everyone else on the road if you get the insurance that would only cost
anywhere between $1000-$2000 per year and as I said, the company ends
up paying for most of the repairs; you would only need to pay part of
the repairs which the insurance companies call the deductable. This can
run from $0 to $1000. Just keep in mind that the more you are willing
to pay for a deductable the cheaper the monthly or bi-yearly rate will
be.
So as you can see, auto insurance coverage is very important for you to
have for your own financial future. If you don't have insurance, then
your finances will end up drowning if something were to happen.
