The rules and regulations of car insurance

Car insurance can be quite confusing if the rules and the stipulations and cover extensions are not understood clearly. Also, since in most countries, insurance is mandatory by state or federal laws, it is important for people to understand these plans and all the costs that they entail. Car insurance is basically that policy of insurance that covers costs of damages to a private use four wheeler, which may have occurred due to a collision or mishap. Although most of these plans extend their cover to only when the car is in use, there are also plans that may cover damages due to natural calamities and so on. Although one predominant rule is that in any case of drunk driving, no cover will be extended of any kind.

Generally these car insurance plans are very effective in covering costs of repairs to cars that have been in collisions and also to pay for damages to any other cars that may have been damaged in the accident because of the insured car. As such, drivers simply have to find a vendor and plan that suits their constraints and needs effectively and also make sure that the costs that these plans entail, suit their budgets. Most of these plans have additional expenses such as excess payments which can be mandatory or voluntary and can make quite a dent in the pocket of the driver. Also, the costs of the monthly payments may not be the same time throughout the insured period and costs may rise depending on a number of factors subject to the discretion of the company.

As such, these reasons for rising costs vary with state, country and vendor but they all basically entails only rising costs because of the rise of certain risk factors. On the whole, it can be said that if the company sees a risk factor rising in the lifestyle, driving profile or in the usage of the car, they may hike up the monthly payment costs accordingly. Although this hike is also regulated, it can add substantially to the costs for the driver. Car insurance policies are basically mandatory in most countries and non compliance can lead to major problems for the driver. Each country may have a different set o rules for the insurance plans depending on which the vendors in that country conjure the best possible insurance plans. As such, generally there are a number of factors which they use in fixing and then changing the costs of the monthly payments. These include:

• Age
• Driving History
• Credit Score
• Gender
• Type and class of the car
• Any past accidents and incidents
• Marital status
• Distance covered by the car annually

As such, each of these factors may be accompanied by more and these are generally the factors that companies use in fixing the monthly payments for each driver individually. There are also several special types of plans for students and so on which may have higher or lower monthly interests depending on the type of policy..