22. If you have caused an accident, which type of automobile insurance would cover damage to your own car?
a.) Comprehensive.
b.) Liability.
c.) Term.
d.) Collision.
Surprisingly, many people continue to carry this insurance on cars that have long lived past the worth of the covering it. Collision is not an option when you are financing a car the company loaning you the money wants to be able to collect something from the insurer if you have an accident.
Some types of collision insurance demand that the replacement of any accident damaged parts must be replaced with factory authorized parts, driving the cost of the insurance up in the process. If you have owned a car for more than six years, you should consider dropping the collision insurance. You will still receive a settlement in an accident if the other driver was at fault. Collision covers accidents that were ³your fault².
Comprehensive covers your car should something unforeseen happens to it or the possessions inside. If a tree branch falls on it, you would be covered. If someone breaks in a steals something like your air bags, you would be covered.
Liability insurance covers you in the event you would be sued and all fifty states require some form of liability insurance in order to drive. Below is a 50 state table of coverage requirements for liability.
Term is a reference to life insurance. It is a period of time for coverage.
State
Liability required? Liability minimums (in thousands of dollars)
The Blue Money Report
Financial Commentary covering a wide range of topics concerning money, investing, and how it effects the average investor and their financial health.
It is the World of Money and Investing Explained.
Our Publication
If you are interested in providing your readers with our syndicated column, you can request it here
