Terms and Conditions of Auto Insurance
Based on the high rate of accidents which happen each year,
it is imperative that anyone driving a car whether it is your car or a friend's
car must have an auto insurance policy even if it is the least of all insurance
policies available.
An insurance covers the policyholder and in most cases it
covers other people who use the car or the driver. However if the car gets into
an accident which is not in the interest of the policyholder, or in violation
with the agreement between the policyholder and the insurance company, the
insurance policy will not cover the damages from such accident.
In instances where the insured vehicle gets sold to another
person, the new owner is covered by the third party liability Insurance and
also by the comprehensive car insurance policy (if there is any) within a
period of 3 weeks after the change of ownership. When there is a new active
insurance policy, all deductibles under the insurance will be paid by the new
car owner.
Auto insurance does not cover damage to vehicles in company
possession for purpose of sale
Depending on the car insurance policy agreement between you
and your insurance company, there might not be a need for you to notify them
when the terms in the policy agreement changed. The consequence of refusal to
notify the insurance might be forfeiture indemnity and compensation if an
accident occurs or reduction of the indemnity and compensation or lapses in the
payment if indemnity and compensation.
Therefore to avoid the consequences stated above, whenever
there is a change in the policy information notify your insurance company
immediately.
You can purchase the same auto insurance from two different
insurance companies without terminating the initial insurance with the first
company but when an accident occurs, the agreement in your car insurance policy
will applied, and this may mean that both companies pay half is the cost for
the accident each.
Another important thing to note regarding auto insurance is
the deductibles which are based on the agreement in the auto insurance policy.
Deductibles are deducted only once in cases of an insurance event involving
both third party liability and damages under the comprehensive auto insurance.
No deductible will apply in situations such as:
1. Damages from a known liable tortfeasor
2. Damages from fire, explosion, lightening or theft
3. Damages from items falling on the car.
Furthermore, there will be additional deductible if there is
driving damage to the car by another person other than the policyholder, or any
registered user of the three car under the auto insurance policy.
There are certain accidents which your auto insurance policy
may not cover. Under the liability insurance, your auto inside policy does not
cover;
1. Injury to the driver
2. Damage from the carriage of goods by road under the acts
of contract
3. Damage to attached vehicle
4. Damage which occurred at the time the vehicle was rented
out unless it can be proved that the damage is as a result of occurrence which
is in accordance with the auto insurance policy
5. Damage to items belonging to the driver, policyholder,
anyone stated in the auto insurance policy it a regular user.
The following accidents are not covered by the comprehensive
auto insurance:
1. Damage resulting from weather conditions
2. Damage car parts during repairs unless it can be proved
the damage had occurred during the driving or by fire
3. Damage in the electrician and mechanical parts the
vehicle, unless it can be proved the damage occurred in accordance with the
auto insurance policy
4. Damage resulting from reckless driving i.e. Overheating
or no change of oil
5. Damage which occurred while the car was rented out
6. Damage which occurred from intoxication of the driver
7. Damage caused intentionally by grid negligence
8. Loss of the car due to seizure of the car by law
enforcement authority
9. Damage under warranty and guarantee
10. Damage from usage of the car such as wear and tear,
scratches on the car body and so on.
Duration of the auto insurance policy is based on the
agreement between you and the insurance company. Most auto insurance agreement
are annual and are renewed yearly unless it's canceled in writing by the
policyholder or the insurance company with a month's notice.

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