Vehicle insurance is a contract between you and the insurance company that protects you against financial loss in the event of an accident or theft. In exchange for your paying a premium, the insurance company agrees to pay your losses as outlined in your policy.
Vehicle insurance provides coverage for:
Property – such as damage to or theft of your car
Liability – your legal responsibility to others for bodily injury or property damage
Medical – the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses
Vehicle insurance is insurance for cars, trucks, motorcycles, and other road vehicles. Its primary use is to provide financial protection against physical damage or bodily injury resulting from traffic collisions and against liability that could also arise from incidents in a vehicle.
Policies are generally issued for six-month or one-year time frames and are renewable. The insurance company sends a notice when it’s time to renew the policy and pay your premium.
Who is covered by my auto insurance—and under what circumstances?
Your auto policy will cover you and other family members on your policy, whether driving your car or someone else’s car (with their permission). Your policy also provides coverage if someone who is not on your policy is driving your car with your consent.
Types of car insurance
There are three levels of cover you can choose from – third party; third party, fire and theft; and comprehensive.
- Third party – This is the bare minimum required by law, but isn’t always the cheapest. It covers injuries to other people and damage to others property.
- Third party, fire and theft – This is the same as third party but also covers the cost of repairs or a replacement vehicle if your car is stolen or damaged by fire.
- Comprehensive – This is the highest level of cover you can get. It protects against damage to your own car as well as accidents involving other people. It can also include a courtesy car and legal expenses insurance; however, this may be at an additional cost.