- September 8, 2022
Why Do You Need Car Insurance?
Car insurance is an agreed policy between a car owner and an insurance company. This policy mandates the insurance company to bear the financial burden in the case of any damage to the vehicle, either by accident, vandalism, or natural disasters. This agreement also covers the loss of the car due to theft and any medical or legal bills incurred in an accident. In some countries, having car insurance is a legal requirement for all drivers.
Fortunately, getting car insurance isn’t as expensive as many people think. Insurance in any form is all about making subsequent payments to an insurer to be protected against an uncertain future event, mostly negative. Thus, many people often belittle the need for having one since the event in question is uncertain. Many have even concluded that all you need to do is exercise caution when driving instead of making provisions for a future accident.
However, accidents can still happen no matter the level of experience of a driver or the condition of a car. Therefore, if you aren’t prepared for a worst-case scenario, you could be facing an expensive repair bill in the near future. Let’s go through some of the reasons why you need car insurance:
It is a legal requirement
In most countries, car insurance is mandatory (at the very least, the state’s minimum liability coverage). In India, for example, the 1988 motor vehicle act mandates every car to have at least a third-party car insurance policy before it can ply a public road. In some parts of Canada, insurance is a requirement to get a driving license, and not having one can incur fines or other penalties.
However, driving without auto insurance is permitted in two states in the UK (Virginia and New Hampshire), and you can also drive without insurance in South East Asia. However, car insurance is highly recommended in these places, and you will be responsible for paying the total cost of any damages that might occur if you are involved in an accident.
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Liabilities to third parties
In the event of a road accident where an insured car is responsible for damages caused to one or multiple third parties, the insurance company covers all losses. This includes physical injury, permanent disability, or death. The insurance company also covers any form of damage to the insured car.
To cover an unexpected loss or damage.
Apart from accidents, other car damaging incidents such as fire, theft, terrorism, riot, vandalism, explosion, or natural disaster can also occur. A comprehensive car insurance policy covers all forms of damages and loss, irrespective of the cause. This gives car owners a safety assurance on their cars.
It covers legal costs.
Car accidents can sometimes result in a lawsuit, especially if it involves a litigious individual who is hellbent on obtaining excessive compensation from you. If you don’t have car insurance, you’ll find yourself in a legal battle that could last months or years, and you will have to pay several legal fees. On the other hand, a car insurance policy can assist you in dealing with the situation. You would have access to skilled attorneys who would argue your case, and you will not have to worry about legal fees.
It sets your mind at rest.
Insuring your car gives you the confidence that you can bear the loss in the event of any emergency. Essentially, it is a way to prepare financially for any future car accident, damage, or loss. Not getting your car insured will always keep you in fear of the unknown, as you’ll be responsible even if the slightest car crash or minor accident happens. This is because you have to bear the unexpected financial burden yourself.
Insurance providers provide a bonus package known as the “No Claim Bonus” (NCB). This incentive can give you a discount on the following insurance plan you choose. The bonus is calculated based on the years you have driven without filing an insurance claim. It is also transferable from one insurer (insurance company) to another and has no set percentage. Your NCB, however, reduces if you are found at fault for an accident.
To protect your commercial vehicle.
A car insurance policy also provides security and coverage for automobiles that aren’t used for personal purposes. A commercial car insurance plan offers a bulk service, meaning that more than one automobile can be registered under the same plan at a reasonable cost, removing the need to acquire a new one for each vehicle. This is an ideal option for business owners whose businesses involve multiple commercial-purpose cars to mitigate any unforeseen future damages or loss.
The primary purpose of insurance is to protect against unforeseen events. Due to the uncertainty factor, many people believe it is an unnecessary expense. However, when weighed against the costs that could be incurred in the event of an unforeseen incident like an accident or theft, it is wise to obtain one. Visit a reliable betting site like Parimatch for an exciting betting experience.