Why is auto insurance mandated

Next steps: Understand what is covered by a basic auto insurance policy. Auto insurance exists to protect your assets If you've financed your car, your lender may require comprehensive and collision insurance as part of the loan agreement.

But if you fail to have car insurance, you might face:. Imagine you have called your close relatives at home for dinner and the best of the dish you cooked was burnt to black. The entire meal was prepared but one of the best items on the list got destroyed.

For sure, you will lose it, but you would never want your guests to know. You will be left with a few choices like manage from whatever is cooked or quickly prepare another dish. But now when the world is digital, and food is just a few minutes away, you would definitely keep yourself fool proof with a fantastic dish. That online delivery food will save you. What occupies your mind was to manage the last-minute hassle and not miss a chance for impression.

Similar can be the situation when you blow up your car not insured and find out that the expenses to rectify it are too high. Incapacity to bear the expenses for liability or repair due to insufficient savings encircles you with worry and stress. Life is a precious gift from God. We need to make it beautiful and safe for our families. One car accident can ruin not only yours but also many other lives.

Buying a mandatory car insurance policy is wise and not an obligation. Still, many remain doubtful to buy it without considering its scope of operation. Click here for Policy wordings. What is Third Party Insurance? RTI in Car Insurance. New Car Insurance. Types of Car Insurance. Renew Expired Car Insurance. Old Car Insurance. Why Car Insurance Mandatory in India? Renew Car Insurance Online. Second Hand Car Insurance. How to Calculate Car Insurance Premium?

Tyre Protect Cover in Car Insurance. Engine Protection Cover. Consumables in Car Insurance. Another reason insurance is important is for you to compensate someone else for your negligence. If you didn't have insurance, the other party could obtain a judgment against you. It could wreck your credit rating and leave you feeling uncertain about your future. Auto insurance can also protect your assets. If you own a business or property, you want to protect them from a court judgment.

When you have assets to lose, you may want to maintain higher liability limits. If you have insurance, another party can pursue a claim through your insurance in order to satisfy the claim.

Non-owner insurance is also called non-driver insurance, which offers some liability coverage for bodily injury and property damage in the event you're driving a car you don't own. Most people purchase the minimum limits of this coverage, but you can increase your policy limits. Some non-owner policies cover medical payments. Experian notes that non-owner policies only cover liability. Comprehensive or collision coverage is not available on a non-owner policy because this coverage is based on specific vehicles.

Sometimes, a court may require a driver to get a non-owner policy to satisfy the terms of a court order. In cases involving serious moving violations, such as driving under the influence, the court may require a non-owner policy before you will be allowed to retain your license. The insurance company will then file a document, known as an SR in most states, that certifies that you have the required amount of insurance. Knowing what factors can increase your premiums can help you make a more informed decision on what insurance policy to purchase, according to The Hartford.

Here are some of the most important factors you should consider:. Some of these may be included as standard, while others require you to pay more. Failing to have car insurance is an offence and can lead to serious consequences. You could face a fine and penalty points on your driving licence. Ironically, this will also make your insurance more expensive in future too. The worst case scenario is that your case goes to court, which means you could face an unlimited, means-tested fine. Your driving license could also be revoked.

You can find out if the car is insured for free, while payment of a small fee can give you access to policy information as well. Getting appropriate cover is required by law, and it will help to protect your finances. To find out when your insurance ends, you can check your paperwork, call your provider, wait for your renewal notice to arrive, or check the Motor Insurance Database.

Yes, car insurance can be paid monthly. In fact, many people pay for their car insurance by monthly instalments. Yes, your no claims bonus NCB can expire — and will do so 2 years after your last car insurance policy comes to an end. The vast majority of insurance companies will let you choose between paying monthly or yearly for your policy.

Your policy will therefore expire at midnight on the expiration date, unless your policy auto renews.