December 8, 2009

Learning How To Read The Fine Print On An Auto Insurance Policy

All auto insurance rates vary, as do the conditions of each individual policy. Therefore, as tedious as it may be to read the fine print on your auto insurance policy, it is a necessary and important task for you to undertake. The reason it is so crucial to this is because, as a consumer, you need to fully understand the terms of the policy – it represents entering into a legally binding agreement with an auto insurance company. It is beneficial to clarify all of the terms and conditions up front rather than be surprised later by a technicality. Therefore, request the terms of an insurance policy at the same time as requesting an auto insurance quote so that you are able to understand exactly what you are paying for. Intimidated by all the strange vocabulary and insurance terms? Here are some tips you can use when reading through your auto insurance policy.

Some common terms in a policy require the consumer to report an accidental injury or death within five business days of the accident, require an injured person to provide evidence of injury due to an accident, and indicate that if a person is under the influence at the time of an accident, or does not observe proper traffic laws, the insurance company is not liable to pay. There are also several important items found in the fine print of a policy, including what happens if you lend your car to a friend or family member and they get into an accident, whether or not your insurance covers you if you rent a car, and circumstances that will increase your premium.

Generally, auto insurance policies state that the consumer is to pay a certain amount of money to protect oneself from financial loss in case of bodily injury or vehicular damage because of an automobile accident. The company will cover expenses as illustrated in the policy when any incident that is covered occurs. The logistics of how these benefits will be paid, as well as exceptions to the rule, are where the grey areas often occur within policies. That is why it is so important to fully understand your terms of coverage – in the event of an accident, you will be fully prepared to handle all claims.

Read through the entire policy and make note of any areas that seem unclear or confusing. Seek clarification from an agent in order to fully understand a policy; the agents are there to provide explanation and guidance. Auto insurance policies are complex documents that may require some time to understand. However, taking this time will be worth it when it comes time to file a claim.