General
Who is required to have auto insurance?
Anyone owning or leasing a car.
Who decides the minimum amount of liability coverage that drivers are legally required to purchase?
State Law
Is comprehensive coverage usually optional or mandatory?
It is usually optional in most states.
What is collision coverage used for?
It is used to cover the cost when you are involved in an accident with another vehicle.
Why does auto insurance not cost the same for everyone?
Different individual circumstances affect the risk associated with that person, so people who are more of a risk pay more for insurance, compared to people who are less likely to have an accident.
What is the name of the cost that you pay each month in exchange for the losses outlined in your policy?
the Premium
What are the 2 components of liability coverage?
Bodily injury liability & property damage liability.
Name 3 examples of damages to your car that comprehensive coverage will pay for.
i.e. theft, vandalism, hail, fire, tornado, flood, etc.
Give 2 examples of costs that medical payments coverage will likely cover.
Any 2 common hospital costs, such as hospital visits, surgery, X-rays, etc.
What determines the average cost of auto insurance near you?
The state you live in.
What are the 3 main categories of things that auto insurance will help you pay for?
Medical, Property (damage, theft), and Liability (legal fees)
What does bodily injury liability insurance pay for?
It may help pay for costs related to another person's injuries if you cause an accident.
What does it mean if a driver is underinsured?
The driver has car insurance, but their liability limits aren't enough to cover your resulting medical bills.
Personal Injury protection covers medical costs when who is at fault?
PIP covers medical costs no matter who is at fault.
On average, what state has the most expensive auto insurance and what state has the least expensive auto insurance?
Most Expensive: New York
Least Expensive: Maine
Why is it important to have auto insurance?
It will prevent the driver from having to pay the entire expense of an accident out of pocket.
What does property damage liability insurance pay for?
It may help pay for damage you cause to another person's property while driving.
If your vehicle is damaged in a calamity that your policy covers, comprehensive coverage will pay to fix the problem in one of 2 ways. If the damage is fixable, comprehensive will pay for repairs, how will insurance help if the car cannot be repaired?
Comprehensive coverage will replace your vehicle, up to the vehicle's actual cash value.
Besides medical costs, what is one thing Personal Injury Protection will likely cover the cost of?
Lost wages
Name 4 factors that affect your personal insurance rates.
Any 4 of the following: age, gender, the type of car you drive, your credit score, the type and amount of coverage in your policy.
What is a minimum auto liability coverage limit?
The minimum amount of insurance the state requires you to have in your policy.
Give an example of a situation that you would need bodily liability insurance and property damage liability to cover costs.
Any example where someone else's property is damaged and someone else is injured when you are to blame. (i.e. You drive into someone's car and the person gets a broken leg; liability coverage covers the cost to repair the car and the leg.)
Comprehensive coverage requires you to pay a deductible. What is a deductible?
The amount you must pay out of pocket before the insurance will cover the rest.
If you hit something, how will collision coverage help you fix your vehicle?
Collision coverage will help cover the cost to repair the vehicle or replace it, up to its actual cash value, minus the deductible.
Why does age affect the cost of your insurance?
People who are young, new drivers, and people who are very old drivers are more of a risk to the insurance company so their insurance rates cost more, compared to middle-aged people.