Auto Insurance Angles
kevin MCCLINTOCK gatehouse plus

Here's the thing about auto insurance: it seems like a complete waste of good money until the unthinkable happens. When that occurs - and it usually does at some point in life - it's good to have that angel sitting on your shoulder.

That's because auto insurance pays for any damage or harm you may cause, or receive, from other motorists.

Think of auto insurance as a contract of sorts between you and the insurance company. You agree to pay a premium, while they agree to pay for losses as defined in the policy, such as property, liability or medical coverage. This premium is based completely on risk. Primarily two things factor your risk: Age and gender. Concerning the former, insurance companies look at the driving experience of an age group. Young drivers tend to have more accidents than older drivers. It costs a company more to insure drivers under age 25, so they charge more for that age group. When it comes to the latter, there's also a link between auto insurance and gender. Males have a history of more accidents than females, so guys face higher rates.

But there are other, outside factors that can sway how much a person pays, as well. One is where they live. Rates tend to be higher in the city, where there are more cars and, thus, more potential accidents. Drivers who drive fewer miles between work and home face a fewer risk of accidents. Most insurers have a set number of miles that qualify for a lower rate, usually 5,000 to 7,500 miles a year.

For young drivers, grades can be key. Students who maintain a "B" (or higher) grade point average pay less than those who do poorly inside

the classroom. Many auto policies last for six months to a year and normally protect the owner in the event of an accident by offering monetary compensation to the injured. They generally offer protection in six areas.

• Bodily injury liability - Protects the driver in case she hits someone and causes that person's injury or death.

• Personal injury protection - Protects the driver in case she is injured in an accident.

• Property damage liability - Protects the driver in case she hits another car, a fence, a telephone pole or any other public or private property.

• Collision - Protects the driver in case she is involved in a crash with another driver.

• Comprehensible - Protects the driver in the event that her vehicle is damaged while she is not driving it, such as by vandals or storms.

• Uninsured and underi sured motorist coverage - Protects the driver in case she is hit by an uninsured motorist. This policy will pay her for damages even if the other driver has no insurance that would do so.

Please remember it's against the law to operate a vehicle without proper insurance. Nearly all U.S. states require drivers to carry some sort of auto liability insurance. An example of how your insurance company will show your minimum liability coverage (the most they will pay) per accident is 15/30/10. This means:

• $15,000 for injury to one person;

• $30,000 for injury to more than one person;

• $10,000 for damage to property.

Most experts think these minimums aren't enough. The Insurance Information Institute recommends $100,000 coverage for injury to one person and $300,000 per accident. Remember, the deductible is the amount you agree to pay before your insurance coverage kicks in. Increasing it from $200 to $500 will reduce your premiums, but will also increase your share of the cost for each accident. If your deductible is $250, and the cost to repair your car is $1,000, the insurance company pays $750, and you pay $250. Nifty, eh?

- Some information provided

by googolplex.cuna.org