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The topic of auto insurance commonly generates many questions regarding coverage, claims, and how to save money.  Here is a quick cross section of some of the most commonly asked questions.

•    Do I need auto insurance?
If you own a car, insurance is not just a good idea, but it is probably required by law depending on where you live.  If you have a loan, the bank will require a policy as well.

•    My state has a comparative negligence law. How does that work? Who decides which driver was at fault?
In some accidents, both drivers may share some fault.  Comparative negligence laws will allow damages to be apportioned by a percentage of liability so the driver who is 20% at fault has to pay for 20% of the other driver’s damage.  This percentage is usually determined by the insurance companies, attorneys, and in court cases, a jury makes this decision.

•    What affects insurance company premiums?
Many factors affect your premiums to include your age, your driving record, the type of vehicle you drive, and your geographical location.

•    If I have an accident, will my premiums go up?
Premiums are based on several factors and accident history is one of those factors.  One or two accidents most likely will not make a difference but a long history of accidents, coupled with repeated moving violations will cost you more money.

•    How do I know if I am being charged the right premium?
There are no charts or guides to tell you what your premium should be.  The best way to tell if you are paying the proper premium is to comparison shop.

•    What is “no fault” insurance?
Insurance that pays benefits to people regardless of who caused an accident.  This term is commonly used to describe the medical payments or personal injury protection (PIP) part of an auto policy.

•    What kind of car insurance do I need for a leased car?
Any liability or medical payments insurance required under compulsory auto insurance laws will still be required if you lease a vehicle.  Additionally, the leasing company will require that you obtain collision and comprehensive coverage on the vehicle because they technically own the vehicle.

•    Can an insurance company fix my car with generic parts instead of OEM parts?
You can specify that the shop uses OEM parts, but many insurance companies will only reimburse you for the cost of generic parts, which means that you will have to pay the difference.  If this is an important issue to you, be sure to shop for an auto insurance policy that specifies that they will pay for OEM parts.  Be aware however that these policies are often more expensive.

Answers to common questions can be handled by any experienced agent or broker.  If you are not getting the answers you need from yours, it may be time to shop around.  When asking insurance related questions, you should look for consistent answers from prospective agents.  Do not be afraid to challenge any answers that you get and make sure you understand your policy before you sign up.