Monday, January 28, 2008

The Price of Auto Insurance Policy & What Auto Insurance Policy is

1.The Price of Auto Insurance Policy

The prices of auto insurance policies vary by company. But all insurers divide drivers into groups of risk and issue from this classification when determine the price.

The premium you pay for your auto insurance policy depends on the following factors:
1. Your sex: women are more attentive drivers and have less accidents than men.

2. Your age: if you are under 25 (for some insurers, under 30), you are considered at higher risk of having an accident.

3. Your marital status: single drivers have more accidents than married ones.

4. Type of your vehicle. Everything is important here: the value, size, weight, age of your vehicle, the cost of replacement parts. The larger, heavier, and cheaper your car are, the less your auto insurance policy costs.

5. Your personal driving record. If your driving record is irreproachable, though, your premium will be lower. Obviously, drivers who broke rules of roads or have accidents will have to pay more for insurance than safe drivers.

6. When and how often you use your vehicle. Your premium is higher if you use your own car for business or are driving in rush hours. Certainly, if you use your car only on the weekends, you are considered to be at lower risk.

7. Where you live. There are small amount of accidents or vandalism in rural areas. Accordingly, there is a bigger chance for your car to be damaged in big city.

2.What Auto Insurance Policy is

Auto insurance policy is a contract between the insurance company and you specifying each party's rights and obligations. Auto insurance policies are purchased to protect you against financial loss associated with motor vehicle accidents. If you are involved in an accident or have your car stolen, owning the right kind of auto insurance can help to ease a difficult situation. You pay the premium from time to time and the insurance company pays your losses as described in your policy.

If you own a car, a motorbike, a boat or any other vehicle auto insurance is an official requirement. There are six different levels of auto insurance coverage. But you are required to purchase only some coverage, depending on your state and/or your lender. Certainly if you want to secure yourself extra, you may purchase a greater coverage. Picking a new policy, make sure you understand all auto insurance considerations in details and you have the right coverage.

When buying a new car or a used one, you may need to purchase an auto insurance policy. If you have a car loan or rent a car your lender may also require some additional coverage.

Most auto policies period of validity is within six moths to a year. Your insurer should notify you by mail when it’s time to renew the policy and to pay your premium. Keep in mind that your marital status, number of children, asset levels have impact on your auto insurance premiums. And in the case of any family situation changes, you may reconsider your policy.