Auto Insurance FAQs
What is auto insurance, and why do I need it?
Auto insurance provides financial protection against physical damage or bodily injury resulting from traffic collisions and against liability arising from incidents involving your vehicle. It’s required by law in most states.
What factors affect my auto insurance premium?
Factors include your age, driving history, vehicle type, location, credit score, and the coverage options you select.
What is the difference between comprehensive and collision coverage?
Comprehensive covers non-collision-related damages like theft, vandalism, or natural disasters. Collision covers damages resulting from an accident involving another vehicle or object.
What is uninsured/underinsured motorist coverage?
This covers your costs if you’re in an accident with a driver who has no insurance or insufficient insurance.
Can I get auto insurance with a bad driving record?
Yes, but your premiums will likely be higher. Some insurers specialize in high-risk drivers.
What happens if I lend my car to someone else and they get into an accident?
In most cases, insurance follows the car, not the driver. Your policy will typically cover the accident, but it’s essential to check your specific policy terms.
How does a deductible work?
A deductible is the amount you pay out-of-pocket before your insurance kicks in to cover a claim.
Do I need auto insurance if I don’t drive my car?
If your car is financed, insurance is usually required. If it’s paid off, you may need at least comprehensive coverage to protect against theft or damage while parked.
What is GAP insurance, and do I need it?
GAP (Guaranteed Asset Protection) insurance is an optional coverage that helps pay off your auto loan if your car is totaled or stolen and you owe more than the car’s depreciated value.
Home Insurance FAQs
What does home insurance cover?
Typically, home insurance covers the structure of your home, personal belongings, liability for injuries, and additional living expenses if you’re displaced.
What is the difference between replacement cost and actual cash value?
Replacement cost covers the full cost to repair or replace your home or belongings without depreciation. Actual cash value considers depreciation.
Does home insurance cover natural disasters?
Standard policies usually cover certain perils like fire or windstorms but often exclude floods and earthquakes, which require separate policies.
Is home insurance mandatory?
If you have a mortgage, your lender typically requires it. If you own your home outright, it’s optional but highly recommended.
What factors affect my home insurance premium?
Factors include the home’s age, location, construction materials, safety features, claims history, and the coverage limits you choose.
How much home insurance coverage do I need?
You should have enough coverage to rebuild your home at current construction costs and replace your belongings.
Can I lower my home insurance premiums?
Yes, by bundling policies, increasing your deductible, installing safety features, and maintaining a good credit score.
Does home insurance cover water damage?
It depends on the source. Sudden damage from a burst pipe is typically covered, but gradual damage or flooding is not unless you have specific coverage.
What should I do if I need to file a claim?
Contact your insurer promptly, document damages with photos, and keep receipts for repairs or temporary living expenses.