Shopping around for car insurance can be an intimidating prospect, especially for those who don’t know much about the associated terminology. It can help to have basic knowledge of certain terms before deciding on coverage. First Insurance Company of Hawaii specializes in providing their Hawaii clients with the best products on the market. Here, they define five terms you’ll come across during the search.
5 Insurance Terms You Should Know
The insurance premium is the amount you pay to continue coverage. If you neglect to make the payments, your insurance policy will lapse. Your premium is determined by a variety of factors, including your car make and model, usage, driving record, deductible, and coverage limits.
2. Liability Coverage
This part of insurance coverage is required by most states. If you are at fault in the event of an accident, it will pay for damages related to the other driver’s medical bills, as well as the repairs to their car.
3. Comprehensive Insurance
Comprehensive insurance covers damages to your car in the event of an incident other than an accident. For example, if your vehicle is hit by a falling tree while it’s parked, comprehensive coverage will take care of the repair bills.
Depending on your policy, you will likely have to pay a deductible before your insurance kicks in to cover the rest of a claim. In general, the higher the deductible, the lower the premium, and vice versa.
5. Uninsured/Underinsured Coverage
While most states require a basic minimum for each driver, many people drive without insurance coverage. This not only puts them at risk, but you as well. The uninsured/underinsured part of your policy provides coverage in the event you are hit by a driver who doesn’t have insurance to pay for your repairs or medical bills.
Call First Insurance Company at (808) 527-7722 or visit their website to get an auto insurance quote today.