In very simple and straight words, Auto insurance gives you protection against any financial loss if you meet an accident. An auto insurance policy ensures protection for you and your family as well as for other drivers driving your car. It covers the losses in the wake of an accident by your fault. Auto insurance is a legal contract among the insured, you and the insurance provider, the insurance company for which you need to pay some monthly or some periodic premium according to the policy taken up by you. In addition, the Auto Insurance Company agrees to pay for all your losses as defined in the policy.

Auto Insurance provides coverage in three aspects of property, liability and medical:

· Property coverage includes the payment for any damage to or theft of your car.

· Liability coverage insures you against the legal and financial responsibility of incurring bodily or property damage to others.

· Medical aspect covers the payment of rehabilitation, treatment of injuries and sometimes-lost wages and funeral expenses.

An auto insurance policy normally has six different types of coverage. Barring a few most of the states, require you to buy some of these coverage options. If you are getting a car financed, your lender might also have some specific requirements.

Generally, auto insurance policies expire within six to twelve months. Your auto insurance company tells you by mail or by giving a call to you when it’s time to pay your premium and when to renew your policy. After that you can decide whether you want keep your auto insurance policy from the same old company or you want to change your auto insurance provider.