Automobile Insurance-Different Types by Emily Retherford

Automobile insurance is the insurance you pay for each month to protect your car in case of an accident. There are many different insurance agencies. You will need to find the one that is right for you. You will need to decide if you want your house insurance with the same company that insures your car. Automobile insurance covers your vehicle in case there are any damages from an auto accident. Even if the accident if not your fault, you will need insurance. In some states it is a law to have car insurance.
Liability
Liability insurance is insurance that only covers the other car if you are in an accident and found at fault. With liability insurance if you caused the accident you will have to pay for the damages to your own car. Most states require you to have at least state minimum liability. This is usually the cheapest way to go and still be legal.
Full Coverage
Full Coverage is just what the name means. It covers the entire vehicle no matter who is at fault in an accident. Full coverage insurance is mandatory if you have a loan on your vehicle. Some loan companies will include your insurance in the payment. However that is usually really expensive.
Gap Insurance
Gap insurance is for people that have an automobile loan. Gap is highly recommended and is provided by the loan company. If you are in an accident and the insurance company declares your vehicle a total loss and you have a loan out still, chances are they will not give you enough to pay off the loan. They only give you want the book value was for the vehicle. This is where the gap insurance comes in. The gap insurance is only a few extra dollars each month but will cover the difference that was left over from the insurance. This will save you money in the end.
SR22 Bond
If you have been caught driving without insurance in a state that requires it, you will have to carry an SR22 bond for 3 years the first offense. What this bond is is the insurance company you are with charges you an extra amount each month and they report to the bureau of motor vehicles each month that you have insurance. If you let your insurance lapse the bureau will be notified and your insurance will be suspended.