How Important Is Car Insurance?

If you own a car, among the expenses you will need to make on your car aside from fuel, regular maintenance, and annual car registration is car insurance.  In fact, you will need to have car insurance first before you can renew your car registration as it has become a prerequisite or requirement when renewing your car registration.  Although car insurance may seem like a complete waste for some, they simply are just unaware of the overall value and help can insurance can provide should the inevitable come.

Road accidents will always happen when you least expect it.  The fact that they happen in the blink of an eye, it means that you can never really prepare for them when they happen.  Now, the best preparation you can make for such is to have the protection of car insurance.  Even though having car insurance will not prevent the occurrence of such accidents, it will how help you financially.  No matter how careful or safe driver you may claim you are, that cannot be said of the other drivers around you.  The best protection you can give yourself and possibly the passengers with you is to have car insurance.

The thing about road accidents is that they always differ each time.  Unless the road or area is an accident prone area, most road accidents will not be always the same.  However, there are two things that are always common to any road accident or incident – property damage or physical injury.  If ever you were to get involved in a road accident and you are the one deemed as the cause of the accident, if you are not insured, you will have to pay for all the damages and medical bills for the accident that you have caused.  Such damages and medical bills are nothing to laugh at, especially when the accident you have caused is a very serious one.

If you are properly insured and that you have proper insurance coverage over the accident that you have caused, you will have the financial backing of your insurance company as they will assist you in covering the cost and expenses of whatever damage you have made.  This is what makes car insurance very important as you will never know when you are going to get involved in a vehicular accident and there really is no telling that you may even be responsible for the cause of it all.…

A Quick Overview Of The Principles Of Insurance

The insurer takes great risk when writing a policy for their client.  Since the insurer does not really know the value or the current state or condition of what is being insured, there is a latent risk that the item may not be worth as much as it is being claimed to be.  For insurers to protect themselves from being undermined, they created six principles of insurance which all insurance companies follow.  This allows them to safeguard their best interest from people or entity who attempt to cheat loopholes within their system or policies.

Utmost Good Faith – it is understood that a client who is insuring something will declare and disclose everything needed about the item.  This will allow proper evaluation of value of the item being insured.  It is the obligation of the client to fully disclose what is needed to be disclosed.  Non-disclosure of crucial information means attempt to commit fraud.

Insurable Interest – if an item is of no important value to you, then there is really no reason for you to insure it.  To insure something that is of no value to you means you would not mind missing it or losing it and can be considered as an attempt to commit fraud.  Only items that are of value to their owners are insurable.

Indemnity – the insurer will only compensate the amount necessary to repair or replace what has been insured.  Depending on the policy, if an insured item becomes damaged or stolen, only the amount valuing the item will be given.  Once claims have been given, the insurer will indemnify that everything is now in its pre-damaged condition.

Proximate Cause – since there are different coverage available for each insurance type, damages resulting from a different cause from that of the coverage purchased will not be provided with claims.  For example, your home is insured for hurricane and wind damage but not flood damage.  If the cause of the damage is flood, even though the flooding was brought by the hurricane, the insurer will not provide you with claims.

Subrogation – any third party causing damage will be sued by the insurer to compensate for the claims given to the policyholder.  Normally, the compensation is worth more than the amount of claims given.

Contribution – a policyholder cannot be insured with the same policy and coverage with more than one insurer.  If claims will be made under such circumstance, only one claim will be provided and the amount will be shared by the insurance companies.…