Car insurance in North America is a legal requirement for anyone hoping to drive a vehicle in this region. The primary goal of insurance is to ensure that the risk of financial liability, physical damages or the loss of the car is covered.
Insurance companies provide car owners an insurance card that specifies the coverage term. This is in exchange for a monthly payment called an insurance premium that is determined on the basis of the driver’s vehicle type, age and gender of the insured drivers, driving history and the location where the vehicle is primarily used and parked. Drivers are required to carry proof of coverage whenever they are on the road.
While the basic insurance requirement is standardized is almost all states in the US, there are certain elements that may differ. For example the state of Virginia does not require vehicle owners to carry car insurance but an uninsured vehicle must pay a fee to the state. Similarly, New Hampshire and Mississippi allow owners to post cash bonds.
In the state of Oklahoma, drivers are required to carry a minimum liability of $25,000/$50,000/25,000 while in California the minimum limits are $15,000/30,000/5000. So before you purchase a vehicle, it is best to be aware of the legal requirements of your state. It might also be a good idea to use online insurance quote services to compare rates.
Differences among states also exist in terms of insurance premiums. Michigan and Louisiana are believed to be the worst when it comes to premiums with drivers paying ridiculously high amounts per month. Maine and Iowa are the best and drivers pay the least as reported by Insure.com. Rates in Michigan may be high because the state of guarantees unlimited, lifetime personal injury protection benefit for treatment of injuries in the event of a car crash.
According to Insure.com’s rankings, the 10 most expensive states for car insurance are:
- Louisiana with an average annual premium of $2,699
- Michigan ($2520)
- Georgia ($2155)
- Oklahoma ($2,074)
- Washington, D.C. ($2,006)
- Montana ($1,914)
- California ($1,819)
- West Virginia ($1,816)
- Rhode Island ($1,735)
- Kentucky ($1,725)
The least expensive states include Maine ($934), Iowa ($1,028), North Carolina ($1,085), Ohio ($1,106) New Hampshire ($1,112), Idaho ($1,133), Vermont ($1,176), Indiana ($1,183), Washington ($1,226), and Arizona ($1,227).
Since insurance is an expenditure hat is not going anywhere anytime soon, it is definitely in the driver’s interest to think it through before selecting an insurance provider. Companies should be evaluated on the basis of their overall rating, premium rates, customer service and claims processing. Keep in mind that even if it takes you sometime to find the right provider, it is worth it in the long run because this is an amount you will continue to pay month after month.
You also need to be sure that you are getting the best possible coverage for the premium that you are paying every month. It may seem that the monthly payment is for nothing in return, but in the event of an accident, you would be glad to have as much coverage as possible. Also, be sure to remember to evaluate your payment options as well.
Some owners prefer to pay every six months or once a year to avoid additional charges that might be included in the monthly premium amount. Others prefer to use auto-pay programs if offered by their insurance providers as they usually cost less. In other words, in the long run, it will help if you compare quotes and take a well-planned and well-informed decision when it comes to car insurance.
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