Car insurance in the United States: what you need to know
If you are planning to travel to the United States and rent a car, or if you live in the country and want to buy or change a vehicle, it is important to know the rules and car insurance options available. In this post, we will explain how the car insurance system works in the United States, what the most common types of coverage are, how to choose the best plan for your profile and how to save money when purchasing your insurance.
What is car insurance?
Car insurance is a contract between you and an insurance company, which guarantees the protection of your vehicle in the event of accidents, robberies, thefts, fires, damage to third parties and other situations covered by the policy. In return, you pay a monthly or annual amount called a premium, which varies depending on the type of coverage chosen, the car model, your driving history, your location and other factors.
Why take out car insurance in the United States?
Taking out car insurance in the United States is mandatory in almost all states, except New Hampshire and Virginia. Each state has its own laws and minimum coverage requirements, which can be found on the Department of Motor Vehicles (DMV) website for that state. If you drive without insurance or with insufficient coverage, you could be fined, have your car impounded or even be arrested.
In addition to the legal obligation, taking out car insurance in the United States is a way of protecting your assets and financial security in case of unforeseen events. Medical costs and vehicle repairs in the United States are very high, and if you are responsible for causing an accident, you may have to pay the costs of property and bodily injuries to other people involved. Without adequate insurance, you could face serious financial and legal problems.
What are the most common types of coverage in the United States?
The most common types of coverage in the United States are:
– Liability (Civil Liability): is the basic and mandatory coverage in almost all states. It covers property damage and bodily harm that you cause to other people in an accident. It is divided into two parts: Bodily Injury Liability (BIL), which covers medical expenses, lost wages and the pain and suffering of victims; and Property Damage Liability (PDL), which covers damage to victims’ vehicles and property. The minimum required coverage varies from state to state, but is generally expressed as three numbers separated by slashes. For example, 25/50/25 means coverage is $25,000 per person, $50,000 per accident, and $25,000 per property.
– Collision: optional coverage that covers damage to your own vehicle in the event of a collision with another vehicle or object. It is valid regardless of the fault of the accident. It usually has a deductible, which is the amount you have to pay out of pocket before the insurance company pays the rest. For example, if your deductible is $500 and your car costs $2,000 to repair, you pay $500 and the insurance company pays $1,500.
– Comprehensive: this is the optional coverage that covers damage to your own vehicle caused by events beyond your control, such as robbery, theft, fire, vandalism, falling objects, animals, natural phenomena and terrorist acts. She also has a franchise.
– Uninsured/Underinsured Motorist: this is the optional coverage that covers your material and bodily damages in the event of an accident with a driver who does not have insurance or has insurance below the minimum required. It also covers hit-and-run cases.
– Medical Payments: is the optional coverage that covers the medical or funeral expenses of you and your passengers in the event of an accident, regardless of fault. It can be useful if you don’t have a health plan or if your plan has limits or co-payments.
– Personal Injury Protection (PIP): is optional coverage that covers medical expenses, lost wages, household services and other losses for you and your passengers in the event of an accident, regardless of fault. It is mandatory in some states that adopt the no-fault system, which means that each person receives compensation from their own insurance, without having to prove the other’s fault.
– Rental Reimbursement: is optional coverage that pays the cost of renting a car while yours is being repaired after a covered accident.
– Roadside Assistance: optional coverage that offers emergency services on the road, such as towing, tire change, door opening, fuel delivery and battery starting.
– Gap Insurance (Difference Insurance): is the optional coverage that pays the difference between the market value of your car and the amount you owe on financing or leasing, in case of total loss of the vehicle. It can be useful if you purchased a new or used car with little or no down payment.
How to choose the best car insurance plan in the United States?
To choose the best car insurance plan in the United States, you must consider the following factors:
– Your profile: age, gender, marital status, driving history, credit, location, vehicle use and annual mileage are some of the factors that influence the price of insurance. The greater the risk you pose to the insurer, the greater the premium you will have to pay.
– Your vehicle: brand, model, year, color, accessories, safety and value are some of the factors that influence the price of insurance. The more expensive and more expensive your car is, the higher the premium you will have to pay.
– Your needs: you must assess your needs and expectations in relation to insurance. Do you just want to comply with the law or do you want broader protection? Do you have the resources to pay a high deductible or would you prefer to pay a lower premium? Do you have other types of insurance that can complement your car insurance?
– Your budget: you must compare the prices and coverage offered by different insurers and choose the plan that fits your budget and meets your needs. You can use websites and apps that provide online quotes or hire an insurance broker to help you with this task.
How to save money when taking out car insurance in the United States?
To save money when purchasing car insurance in the United States, you can follow the following tips:
– Search and compare: get quotes from several insurance companies and compare the prices and coverage offered. You can negotiate discounts and special conditions with insurers or brokers.
– Choose your vehicle carefully: opt for a cheaper, safer car that is less targeted by thieves. Avoid sports cars, convertibles, imported or modified cars. Install security devices in your car, such as an alarm, tracker or blocker.
– Increase your deductible: if you are confident in your driving ability and have the resources to pay a high deductible in the event of an accident, you can opt for a higher deductible and reduce your insurance premium.
– Reduce your coverage: if you have an old or paid-off car, you can waive collision and comprehensive coverage, which are generally the most expensive. You can also opt for more basic coverage or with limits
conclusion
In summary, when driving in the United States, always remember to check your state car insurance laws, choose coverage that suits your needs, and drive responsibly to avoid legal and financial problems. After all, car insurance is more than just protection for your vehicle; It is a guarantee of peace of mind and safety for you and others on the roads.
