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How Does Car Insurance Work?

Cars are immensely important to help us complete our day-to-day tasks. We use them to pick up our children, see our friends, drive to work, and more. As much freedom as vehicles give us, there is a lot of paperwork involved. Licenses must be obtained and kept up to date, and of course, car insurance.

Car insurance is required to legally operate a vehicle. This insurance is required in case anything were to happen while driving a vehicle. However, it can be a little bit confusing. Here is how car insurance works, and why it is required.

Car insurance is required due to liability. If you cause damage to another person’s property, then you are legally liable for that damage. Without insurance, you could be responsible for thousands of dollars between someone’s injuries and property damage. This could bankrupt you almost immediately. Insurance isn’t only required for your own damage, but for the damage you could potentially cause to others. Car insurance is meant to hold you accountable for others in case you injure or damage someone else or their property.

Now that we know why car insurance is required, let’s get into how it helps. Car insurance is meant to protect you from the financial burden of accidental damage to you or someone else’s vehicle. In order to keep your insurance in good standing, you must pay a monthly fee, called a premium. Your premium price can differ depending on the type of coverage you wish to have, and whether you’d like to have a high premium and low deductible, or low premium and higher deductible. If you get in an accident, your insurance will step in to cover the costs. All you have to do is call your insurance and file a claim.

However, filing a claim isn’t free. It works similar to a doctor’s office, where you pay a deductible, or a certain amount of the claim. The amount depends on the level of your insurance. There are also certain plans you can add on, which will help you in certain situations.

Liability insurance handles the accidents that you may cause. If this happens, then you will be liable to cover any damages or injuries that occur. This part of insurance is required in order to protect everyone on the road. The three required parts of liability insurance include bodily injury liability for one person, bodily injury liability for multiple people, and property damage liability.

Personal injury protection is also important if you plan on driving. This is a no-fault part of your insurance that will cover any injury that happens to you or your passengers, no matter who was driving your vehicle.

Collision damage covers any damages to your vehicle. It is not required, but incredibly helpful if you get in an accident. If your car has damage that exceeds the value of your vehicle, then your insurance will “total” your car in order to pay you a portion or all of the value so that you can replace it.

The best way to avoid dealing with insurance is to avoid an accident altogether. However, if an accident occurs, then insurance will help you avoid paying thousands out of pocket. Car insurance functions so that if you pay a little every month, you won’t have to pay a lot later.

If you’ve been injured in an accident, personal injury lawyers can help. Here at Greathouse Trial Law, we want to help you understand what to do following an accident.

Contact us today for your free case evaluation. We aim to serve the great people of Atlanta, and to give a voice to the voiceless.

Greathouse Trial Law
260 Peachtree Street NW
Suite 803
Atlanta, GA 30303
(678) 374-4611

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