The thought of buying car insurance can be intimidating to a lot of new drivers out there. The car insurance industry has a lot of confusing terms that can make it difficult for new people to understand what is being said. However, having car insurance is extremely important and crucial to owning a vehicle of any sort.
Car insurance protects drivers from suffering severe financial loss in the event of an accident. Accidents can be very expensive, vehicles will need to be repaired, and there could be possible medical or funeral expenses. This can add up to several thousands of dollars, which is why all states require drivers to have some form of car insurance.
In Louisiana, drivers are required to have liability insurance that offers at least:
- $15,000 for injury/death to one person.
- $30,000 for injury/death to more than one person.
- $5,000 for damage to property.
To get this kind of coverage, you will need to talk to an insurance company. Each insurance company will take a look at a number of different factors about you as a driver, and use that to figure out what your rate would be with them, meaning how much you would have to pay a month to be insured by them. Insurance companies all have their own unique formula for figuring out how much clients will pay, but they all look at the same following factors.
- Your driving record
- Your vehicle’s make, model, and year
- Your age, gender, and marital status
- Your occupation
- Your claims history
- How many miles you drive per month/year
Some companies place more weight on clients’ driving record, while others put more on their client’s vehicle. This is why some companies can offer you a better deal than others, and why you should shop around when looking to get car insurance.
With car insurance, you will pay a premium every month to the insurance company. This money goes into a pool of money from other clients, and is put away. In the event of an accident, the company uses this pool of money to pay any claims made. A claim is essentially when a client gets into an accident, and requests that the insurance company pay for any damages.
This has been a very brief explanation of car insurance. Hopefully, knowing some of this information can make looking into car insurance easier. There will be less confusing information out there, now that you have small understanding of how car insurance works.