What is car insurance?

Car insurance is basically a part of the more comprehensive third party vehicle insurance and it caters to private four wheelers that are used by individuals and cover the justified claims of any damage, accident involving the car in the event of a crash or bump with other objects or even with other cars. As such, there are different plans that offered by various vendors across countries and customers simply have to choose the plan that will provide them the best balance between monthly payments and the scope of the coverage. These insurance plans are mandatory in many countries and their rules and regulations are subject to state of federal jurisdiction depending on the country. These plans are extremely beneficial to the driver when the car is in a crash as most of these plans cover entirely or a large part of the cost of repairs and therefore can save a great deal of money for the driver.

There are various rules and stipulations that have to be understood before drivers buy their car insurance policy. The various countries which have their own policies and rules, and which are legally enforced, include:

• USA
• UK
• INDIA
• ROMANIA
• IRELAND
• GERMANY
• INDONESIA
• CANADA
• AUSTRALIA
• HUNGARY
• SOUTH AFRICA

In these countries, whenever a car is bought, an insurance policy of the car will have to be bought. Most of these insurance plans and their costs are tailor made to suit the needs and rules of the vendor company and also to fit the financial constraints of the driver.

Each policy is therefore very distinct in its coverage and therefore the monthly payments. Also, these monthly payments may be subject to a variety of past and future factors and therefore may increase or decrease accordingly. The basic yardstick is the measurement of risk involved in insuring the car. This risk is measured in a variety of ways which include the driver’s past history, any road and driving related incidents and accidents in the past, driving profiles, the usage of the car, the nature of the car, the place of use and also any future incidents and accidents that may occur during the use of the car. As such, there are also fixed monthly payment plans, but these generally involve very high monthly payment costs and may also require some compulsory guarantee payment up front. There are also various other costs which may be levied periodically on the driver. These are called as excess payments and these maybe either compulsory excess charges or voluntary charges. As such, while signing up for the insurance plan, these charges and the total cost of the plan will have to be taken into account..