What is Auto Insurance?

Auto Insurance also called Car Insurance, Vehicle Insurance, Motor Insurance, or GAP insurance.
Auto Insurance is insurance purchased for road vehicles such as cars, trucks, motorcycles, and other. The function of this insurance is to provide financial protection against physical damage and/or bodily injury resulting from traffic collisions and against liability that could also arise therefrom.

The specific terms of auto insurance vary with legal regulations in each region. To a lesser degree auto insurance may additionally offer financial protection against theft of the vehicle and possibly damage to the vehicle, sustained from things  other than traffic collisions.

If your vehicle struck down by a falling tree, stolen by a crook or totaled by a distracted driver, Do you have enough savings to repair or replace it?

Fortune, having car insurance means you don�t need a massive savings account to repair or get new car. auto insurance gives you protection against six types of risk and potential financial losses:

• Bodily injury: Pays when you hurt someone in an accident or get sued for the victim�s injuries.
• Collision: Will pays for damage to your car (minus your deductible) when you get into an accident, even if it�s your fault.
• Comprehensive: Pays for damage to your car (less your deductible) caused by something other than a collision, such as fire, vandalism or a falling tree.
• Property damage: Will pays for damage you do to someone else�s property, like damaging that person�s car or destroying that person�s fence or landscaping.
• Personal injury protection (PIP): Pays when you or your passengers are hurt in an auto accident and may cover lost wages, medical bills and funeral expenses.

States and lenders have different requirements for the types of auto coverage and minimum amounts you have to buy. For instance, Texas requires drivers to carry insurance that pays at least $60,000 for injuries and $25,000 for property damage per accident.

However, if your financial damages exceed your car insurance coverage, you could be sued for the difference. So always make sure you have enough auto insurance coverage to protect your assets.

How much will car insurance cost?

When you purchase car insurance, the amount you�re charged (the premium) varies reckoning on factors such as your age, vehicle make and model, driving record and credit score.

Yes, that means if you�re young, have been in a few fender-benders or have poor credit, insurers may consider you more risky and charge you more than average drivers in your area.

The vehicle you choose to drive also determines the cost of your auto insurance. It probably won�t surprise you that family mini-vans cause fewer losses for insurers than fast, sporty cars. (Read �The 15 cheapest vehicles to insure� to learn more about cars and trucks with low insurance costs.)

Another important factor that insurers consider is where you live. For 2010, the average auto insurancepremium in Washington, D.C., was $1,134. But in North Dakota it was only $529, according to the National Association of Insurance Commissioners.

The good news is that many insurers offer discounts.