What is Car Insurance?
Car accident is a reality. How safely you can drive your vehicle but you can never guarantee on other people’s judgment. Even, when we are taking, someone somewhere might have bumped the road. In addition to physical losses the affected might incur financial losses which at times become very hard to bear. And, that’s exactly why
Car Insurance is more than a legal necessity.
Car insurance brings peace to your mind by insuring against the possible financial losses in case an eventuality takes place. To insure your car, you need to contact a
Car Insurance provider and pay him a premium amount. The premium amount is calculated based on your complete driving history and risk profile. So, things like your age, driving history and your area, all play an important role in ascertaining how much you have to dole out as a premium amount.
Why do You must have Car Insurance?
The most important reason for every person who drives a car to have an applicable and existing insurance policy is the legal requirement. Every driver is legally obliged to insure his car.
In addition to insuring the vehicle,
Car Insurance Companies also offer additional cover for an extra fee. The additional coverage may include breakdown cover, payment protection, and third party insurance for injuring other person and car accessory theft protection. Every accident brings unexpected costs in the form of car repairing costs, medical costs etc., and a car insurance policy help you pay those bills.
How do Insurance Companies Protect the Victims of Uninsured Drivers?
If an uninsured driver injures a person or damages his property then the affected person also called third party receives reimbursements for the damages caused from the Motor Insurers' Bureau. Also, Car Insurance reimburses for stolen vehicles in case a car thief damages or steals property or injures another person.
Motor Insurers' Bureau (MIB) was established in 1946 for the purpose of entering into Agreements with the Government to reimburse the victims of neglectful, uninsured and untraced motorists. By virtue of the Road Traffic Act 1988, it is obligatory for insurance providers, underwriting compulsory
Car Insurance Guide, to be a member of MIB and to contribute to its funding.
In 2001, the insurance industry set up a Motor Insurance Database to trace uninsured drivers. The Motor Insurers’ Information Centre (MIIC), a division of MIB, controls the Motor Insurance Database and also acts as the information centre.
The
Motor Insurance Database holds details of all private and fleet motor insurance policyholders. The police are the biggest user of this data base making more than 3.8 million enquiries per month. It facilitates them to carry out checks on vehicle drivers to confirm they have a valid motor insurance policy.
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