Discussion of Vehicle Insurance Coverage

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Overview

Vehicle Insurance is an insurance policy designed to protect your property interests related to the cost of fixing problems with your vehicle. Such problems can be breakdowns, accident recovery, theft, and damage. The widespread use of automobiles came after World War I, but insurance issues were not raised. There are two central systems of insurance in the American market: in most states, the injured party receives compensation from the person who caused the accident, and in other states, the balance is paid in any case. Most states require at least liability insurance, that is, damage that the driver may cause to other road users or surrounding property. Some allow you to cancel your insurance, but you will still generally need to prove your ability to pay in the event of an accident. I live in Georgia, I have only one car Toyota Tundra and I use full coverage.

Vehicle Insurance Questions

1) Rating Factors are the metric by which a vehicle owner is rated. In most cases, insurance companies look at age, driving history, credit rating, level of coverage, and annual mileage. This list is incomplete, but the above criteria play the most significant role when applying for insurance. In Georgia, the focus is on personal factors: gender, age, marital status, residence, and parking location. Factors also apply to the car: type (personal or business), number of vehicles, current insurance, mileage, and years of service. The most crucial state criteria are credit rating and history of previous accidents.

2) There are five types of coverage enshrined in U.S. law. These include bodily injury (BI) liability, property damage (PD), personal injury (PIP) and physical damage insurance, and uninsured motorist insurance (UIM). The mandatory criteria vary from state to state, and together they constitute the minimum, i.e., the cheapest option. Driving in Georgia without insurance is illegal; minimum coverage includes BI and PD. BI is $25,000 per person and $50,000 per accident, PD is $25,000 (Hearst Autos Research, 2021). In South Carolina, the minimum coverage is increased because it includes BI, PD, and UIM. The first two coverages are the same as in Georgia; UIM is $25,000 per person and $50,000 per accident. In addition, drivers must pay for property damage coverage to an uninsured motorist at $25,000.

3) Exceeding the coverage minimum is necessary because it allows you to cover additional unforeseen expenses. Using only the minimum can significantly limit the use of the vehicle and increase the cost of the car. I am concerned that the number of accidents has dropped only slightly, and the percentage of fatalities in accidents remains high. I use the full coverage provided by Liberty Auto Mutual. I don’t think I will resort to all coverage items, but the complete list provides a comfortable driving experience. In the future, I plan to continue using the full coverage.

4) The amount of insurance varies depending on rating factors and the amount of coverage. The average insurance amount is about $1,600 per year in the USA; it is not very expensive (Norman, 2021). However, the amount can vary if the driver is involved in an accident or has a bad credit history. Full coverage in Georgia averages $1,800 per year, with a minimum of only $757 (Araujo, 2021). For South Carolina, coverage costs $1,662, and minimum coverage costs $606. Although the minimum range includes more figures, the amount is less than Georgia.

5) As I said earlier, traffic fatalities continue to rise, with a 7.1% increase in 2020 compared to 2019. It is probably due to changed conditions during the pandemic, but it does not absolve the driver of road accidents. The rate rose again in 2021, with 17,000 deaths in the first half. The Georgia Department of Transportation provided a report that said more than 1,000 deaths in 2021(NHTSA, 2021). South Carolina is not a comforting statistic either, with 1,005 fatalities (Brams, 2021). Both indicators demonstrate that insurance is necessary to preserve one’s funds.

6) The additional insurance of my chosen firm consists of car protection, personal medical expenses coverage, and coverage for others. The first category covers collision, the need to repair or replace the vehicle, 24-hour roadside assistance, and parts replacement. The second and third category provides coverage for medical payments, personal injury insurance, and uninsured motorist coverage. This coverage minimizes the risk of large payouts in the event of an accident and can solve my car breakdown issues.

7) In 2021, the monthly payment was only $100 because I did not use all services. At this point, that amount has increased because I chose additional insurance. The insurance company’s perks are good driving, discounts on full payment, and a deal on a paperless policy (Liberty Mutual Insurance, 2022). I have a small percentage for decent driving, and I want to switch to a paperless policy to save my money.

Summary

Vehicle insurance should be compulsory; each owner must guarantee their ability to pay when purchasing a vehicle. Insurance can solve the problem of a crowded car market and the amount of unused “downtime.” In my case, full insurance is driven by the need for daily driving, which makes me want to have peace of mind about my car in case of accidents. In addition, I think my driving experience will allow me to reduce my annual payment. I will probably decide if I need it and adjust my insurance while I’m using full coverage.

References

Araujo, M. (2021). Minimum car insurance requirements by state. The Balance. Web.

Brams, S. (2021). SC traffic fatalities reach five year high in 2021. South Carolina News. Web.

Hearst Autos Research. (2021). Georgia car insurance law: everything you need to know. Car and Driver. Web.

Liberty Mutual Insurance. (2022). About car insurance coverage types. Liberty Mutual. Web.

NHTSA. (2021). Native American traffic safety facts. NHTSA. Web.

Norman, L. (2021). Average car insurance costs in 2021. Nerdwallet. Web.

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DemoEssays. (2023, January 5). Discussion of Vehicle Insurance Coverage. Retrieved from https://demoessays.com/discussion-of-vehicle-insurance-coverage/

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"Discussion of Vehicle Insurance Coverage." DemoEssays, 5 Jan. 2023, demoessays.com/discussion-of-vehicle-insurance-coverage/.

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DemoEssays. (2023) 'Discussion of Vehicle Insurance Coverage'. 5 January.

References

DemoEssays. 2023. "Discussion of Vehicle Insurance Coverage." January 5, 2023. https://demoessays.com/discussion-of-vehicle-insurance-coverage/.

1. DemoEssays. "Discussion of Vehicle Insurance Coverage." January 5, 2023. https://demoessays.com/discussion-of-vehicle-insurance-coverage/.


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DemoEssays. "Discussion of Vehicle Insurance Coverage." January 5, 2023. https://demoessays.com/discussion-of-vehicle-insurance-coverage/.