Car accidents have become quite a common phenomenon with more than 1200 cases registered every day in United States alone. Besides emotional set back, people have to bear financial burden on account of the heavy damage to their cars, and here automobile insurance comes to their rescue.
Automobile insurance is a very crucial step to get the car insured. It covers all the cost of any kind of repairs that may require for the damaged car on account of accidents. But before going on for the finalization of getting the automobile insurance, it is important to compare the car insurance rates for various automobile insurance companies. The quotes are fixed taking into consideration various factors like the age of the owner of the vehicle, for how many years car has been driven, past history of accidents, the place where vehicle is parked, whether the vehicle is second hand or new, average life of vehicle and mileage. If the car is not being driven to its full capacity then many automobile insurance companies may offer some discounts or cuts in prices.
In many areas, it is very compulsory to get the automobiles insured. In 1994, some studies conducted by Jeremy Jackson and Roger Blackman formulated the homeostasis theory. But it was finally formulated by Gerald J.S. Wilde, who was a professor of psychology at Queen’s University, Kingston, Ontario, Canada. The theory states that every human being is prone to some level of risk that amounts to some extent acceptable, but the range of this acceptable risk is different in different persons. When the range of this risk varies in the life of single individual, the risk level will fluctuate accordingly in the other individual. The same is true with the group of large number of human beings. For example, in the famous Munich Cab case, suppose few cabs have been equipped with antilock braking system (ABS) brakes, where as other cabs are equipped with old brake systems, but the rates of accident are almost the same in both the types of car. It is because drivers of the car having ABS brakes drives carelessly and so are more prone to accident thinking ABS would not lead them into any difficulty. In this pursuit they are actually increasing the risk. On the other hand, drives of non- ABS take on the roads more carefully assuming if they ride faster they are more at risk of having accidents. Automobile insurance revolves around this theory.
Automobile insurance policy provides six basic coverages as described by Insurance Information Institute Online, with prices varying for each: Bodily injury liability, Medical Payments or Personal Injury Protection (PIP), Property Damage Liability, Collision, Comprehensive and Uninsured and Underinsured Motorist Coverage.
If you lease a car, you are offered collision and comprehensive coverage besides others as per applicable in your country and if you rent a car you still need insurance. In whatever way you are enjoying a joy ride in your favorite car or any other automobile, you cannot escape to have insurance. Automobile insurance coverage is for your safety and especially safety for your cars, so avoiding it would be more damaging.
