What is auto insurance?
Owning a car involves risks. When a car accident occurs, people may be injured and vehicles (or other property) may be damaged. Damage can also occur through theft, vandalism, or natural disasters. Auto insurance can protect you against the financial loss associated with these risks. Insurance companies provide auto insurance through personal auto policies (PAPs). A PAP is a contract between you and your insurer, specifying each party's rights and obligations. Essentially, your insurer promises to provide specific coverage for you. In return, you pay a premium.

Why do you need it?
State law (and/or your car's lender) often requires you to purchase at least a minimum amount of auto insurance. You may find it sensible to purchase greater coverage, however, in order to protect your auto investment, pay for necessary medical expenses, cover your legal liability, and cover any additional losses related to driving. Consider the following: if you cause an accident and the other driver suffers damages over and above your insurance policy's limits, your personal assets and future earnings may be put at risk.

What do you need to know?
First of all, it's important for you to know how to read and understand an auto insurance policy. Next, you'll want to carefully balance cost against desired coverage. Finally, you should allow us the opportunity to evaluate and compare the various car insurance products you want or have, to ensure that you get the best value for your insurance dollar.

Understanding your personal auto policy (PAP)
Your policy is broken into simplistic and logical sections. It discusses types of coverage, rights, and obligations under the policy, as well as exclusions or limitations. Types of coverage include liability coverage (injuries/damage you cause to other people and other property), medical payments coverage (medical expenses that will be paid--up to a specified limit--regardless of fault), uninsured/underinsured motorist coverage (losses caused by a driver who is uninsured or has inadequate insurance), and coverage for damage to your auto (accident damage and other damage or loss).

What is a deductible?
Regarding damage to your own auto, collision and comprehensive coverages may each include a deductible. A deductible is basically a risk that is self-insured. It's an amount of money that you are required to pay before your insurance kicks in. Deductibles can come in any dollar amount, but are generally $100, $250, $500, or $1000.

Coverage vs. cost
You will always want to balance coverage against cost. Choosing the appropriate level of coverage depends on a number of factors, including the value of your vehicle, the value of assets you must protect, the amount of money you can afford to pay out-of-pocket, and your tolerance for risk. If a claim against you exceeds your coverage limits, you will be personally responsible for the amount that exceeds the coverage. As a licensed independent agency we can tailor the policy to fit your needs. To arrive at the cost of your premium, the insurer will consider the coverage levels you select and will use statistical information about you, the area you live in, and your car.

Evaluating and comparing policies
Compare policies in terms of coverage, exclusions, the reputation of insurer and then price. If you ever find yourself shopping for different quotes, make sure you are comparing extremely similar policies. Also, weigh the policy cost against both coverage and the quality of service provided.

When to get it
You may need to purchase auto insurance whenever you buy a new or used car. You may also need to reconsider your present policy if your family situation changes. Because marital status, number of children, and asset levels may change over time, you should try to review your existing policies from time to time to ensure adequate coverage is always maintained.