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Auto Insurance

A Beginner’s Guide to Auto Insurance

Do you own a car? If so, then you need auto insurance before you or anyone can legally drive the car on public roads. Most states require that all car owners have auto insurance before they can renew a tag or get a new tag.

Understanding Auto Insurance

Car insurance provides financial assistance to the policyholder following an accident. If property damage occurs or a driver or passenger is injured, then the policy will cover the cost up to a predetermined amount. If the accident is determined to be no-fault, then each person pays for his or her own expenses.

Types of Coverage

Basic liability covers basic damage and physical injuries. Collision pays for repairs to your car following an accident, and comprehensive coverage pays for damage that occurs for other reasons. Usually, liability is the least amount you can have and still legally drive you car. It may be possible to purchase underinsured/uninsured coverage for when you are hit by a driver who doesn’t have coverage or doesn’t have enough coverage.


The main benefit of this coverage is you can legally drive your car. If you’re asked to present your insurance papers, then you can avoid getting a ticket or going to jail. Another benefit is the policy will pay anywhere from $5,000 to $100,000 per person in damages if you are at fault for an accident.