What is Automobile Insurance?
June 3, 2008 2:56 am General Information
Automobile insurance as with any type of insurance is a contract, called a policy, between the insurance company and the automobile owner that provides financial security to the owner in case of accidents or unforeseen natural events. The policy is executed with the understanding that in exchange for a regular payment, called premium, to the insurance company, they will provide coverage for liabilities of the automobile owner in case he is involved in an accident.
Automobile is usually required especially for new vehicles prior to registration with the appropriate government agency. Every country has a minimum automobile insurance coverage requirement that the owner of the vehicle has to purchase from a private insurance company before his vehicle is considered road worthy.