When it comes down to the point of getting a new car through a financing option you need to include the cost of all the fees that they are going to tack on, as well as the insurance that you will be required to have. The type you need will be a set requirement for most dealers, and that will be a comprehensive policy that will cover the car, its occupants, and any other devices that may get damaged in the accident. You may also be required to get collision coverage on it as well. You may have already expected to have to pay the maximum amount of insurance costs, but just in case we are going to go over exactly what comprehensive covers, and why it is important to you, and why your lender requires it. You need to remember that comprehensive car insurance covers damage to your vehicle, damage to the other vehicle or property, and everything in between.
COMPREHENSIVE CAR INSURANCE
- Animals: Accidents with animals happen. It does not matter how careful you are, animals like to jump out in front of you. Sometimes they will charge your car for no reason, ramming straight into it without you having the chance to move out of the way. Comprehensive will cover anything that an animal does to your car.
- Mother Nature: Mother Nature can have an attitude at times. Floods, earthquakes, tornados, hail, and volcanic eruptions (hopefully you are not in the car when this happens.) Anything that mother nature throws at you will be covered, whether it is a simple repair or a total replacement, comprehensive car insurance will cover it. Just make sure that all the natural disasters that are common where you live are covered.
- Fire: This could be included in the coverage above, but it is too important not to cover it separately. Fires can happen at any time, at any location. This section of your policy will cover you against fire damage and destruction to your car, even if it is caused by a neighbor’s house fire. An important thing to remember about the fire coverage is that if a vandal decides to target your car, and light it on fire, your comprehensive insurance policy will cover any and all costs related to the fire.
- Riots and Vandalism: While we are on the subject it needs to be added that not only will fire be covered during a riot, or when your car is targeted, but any damage that is done. It is an unfortunate circumstance these days, but riots seem to happen more often than they used to. And vandals have free rein to do as they please, without much fear of getting caught. Comprehensive insurance will even cover damage done if a car thief decides to go for a joy ride in your vehicle. It is important for you, and your insurance company, to be covered.
- Theft: This was touched on above, but it is important to know that your entire car is covered in cases of theft. If they steal the entire car and it is not recovered within a reasonable amount of time, you will get enough money back from the claim on your Victoria car insurance policy to replace it. If they choose to just cut the catalytic converter off, or take your stereo, your policy will cover the replacement costs of those items.
- Fallen Objects: Windstorms are simply a part of life that we all must deal with from time to time. Depending on where you live, it may be more often than not. These storms can cause some severe damage to the trees and objects around your car. When things get damaged, they fall off and if your car happens to be close by it will get damaged. The comprehensive policy covers any damage done to it, but you will still need to clean up the mess that it left.
- Windshield: You have all been driving down the road at one time or another and had a rock kicked up onto your windshield from a careless driver, or from a semi going by you. Rock chips can spread out into a crack. A crack that can go all the way across your windshield, to the point of requiring it to be replaced. Once your line of vision is compromised, the window needs replaced. Comprehensive insurance will cover any part of the damage, from rock chip repair to an entire replaced.
COLLISON CAR INSURANCE
The second type of policy will be the collision coverage. This type of policy will cover the costs to repair or replace your car if you should hit an object, such as a tree or a telephone pole. Let us say you are driving around on some backroads and the back tires kick out on you. The car flips off the road into a tree. Both parts of this accident would be covered under the collision insurance. In this instance they will probably just mark your car as totaled and pay out enough to get a new one. If it is repairable, though, you will need to have it repaired at an autobody shop.
COMPULSORY THIRD PARTY (CTP) INSURANCE
This was not mentioned in the beginning because it is the coverage that is required by law, and unless you live in South Wales it would have been added to the cost of the registration. Just so you are aware, this policy will cover the costs of the medical or mental bills that are associated with the third party. By third party it is meant the other people involved in the accident.
FINAL THOUGHTS
That is the basics of what type of coverage you will need when financing a car. The policies are not only important to protect you and your property, but it protects everyone else that could be involved in it with you. It also covers the lender because they will be ensured that you can pay off the loan that you had. This makes it hard to replace the car, but you can always apply for another loan once you pay the main one off with the insurance settlement that you get.