The types of insurance you can get will depend heavily on whether you own your vehicle outright, lease it, or have a vehicle loan for it:
*If you lease your vehicle, the leasing company or car manufacturer may require that you insure the vehicle through them or through a company they have partnered with. This may be done as a way to ensure that you maintain the level of coverage they want.
*If you have a vehicle loan, most lenders will require that you have full coverage on your vehicle.
*If you own your vehicle outright, most states will allow you to have just liability coverage.
What is liability coverage?
Having liability coverage means that you carry insurance that covers only the other person’s car in the event of an accident and any injuries sustained by the other driver and his passengers. Any damage to your vehicle will have to be paid out of pocket, or, if the accident is not your fault, the “guilty” driver’s insurance could pay the damages, but damages to the vehicle you hit would be covered in their entirety.
What is full coverage?
Having full coverage on your vehicle means that you have liability coverage as well as collision coverage and comprehensive coverage. The idea is that no matter what happens to your vehicle, aside from maintenance issues, will be covered. It also means that you have personal injury protection or PIP, so that you are covered no matter what happens to you or your passengers.
How much does car insurance cost?
Your car insurance rate is based on several factors: your age, driving record, marital status, vehicle (age, condition, type, safety features, commonality of theft), and credit history, although some auto insurance companies will include other variables, such as whether you own your home, have a pet, and your profession. Auto insurance companies use these variables as a way to determine the risk insuring you presents.
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