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Auto Insurance Your comprehensive guide
Modern automobile insurance coverage has been around for more than 100 years and first became mandatory in Connecticut in 1925. However, most states did not require car owners to insure their vehicles until the mid-1950 s. Currently 48 states and the District of Columbia require proof of valid insurance to register and operate an automobile.
According to the business intelligence services company SNL Financial. U.S. insurers paid out more than $65 million in liability claims in 2012 and $41 million in property damage claims for private passenger auto claims alone. AAA estimates that U.S. accidents involving cars are responsible for roughly $164 billion in damages a year. Without the resources of insurance company lawyers and adjusters, uninsured individuals would no doubt have incurred much higher costs. While most Americans understand that car insurance is important, most people are shaky on how their insurance actually works. This guide is here to teach you the fundamentals.
What is Auto Insurance?
The phrase auto insurance is a general term that refers to various types of insurance protection for cars. The Insurance Information Institute explains that an auto insurance policy can include up to six different types of coverage:
- Uninsured Motorist
- Underinsured Motorist
- Personal Injury Protection
The simplest explanation of auto insurance is that it agrees to pay all or part of the costs associated with an accident, theft or other cause of damage to your car. In exchange for this coverage, you need to pay an insurance premium to your provider.
Average Expenditures for Auto Insurance, United States, 2001-2010