Car insurance is the indemnity cover that is offered to the car owner. In most countries, it is a statutory requirement that every car on the road be insured. This serves two purposes; one if to protect other road users and secondly it is to provide the state with revenue. As much as the car and the owner are also saved from losing the investment in the event of an accident or theft, this is never the main objective for the authority’s regulations that demand that you buy car insurance.

Before you buy car insurance, it is important to know the choices available to you.

Comprehensive car insurance: this is termed comprehensive because it covers all imaginable types of risks. When you are on the road driving a motor vehicle or when you park it anywhere, the risks that you are exposed to are myriad. This include theft, traffic collision or rolling off the road, fire, tornadoes, floods and many other risks. Such incidences when they occur would make you lose your investment within a moment. However when you buy car insurance that comprehensively covers all these risks, you are guaranteed that you would always redeem your investment. It does not matter which of the incidents occur. A few insurance companies would however not insure your car against natural catastrophes or public riots.

Third party insurance: this is the minimum cover accepted by most authorities. It secures other road users such as other drivers and pedestrians. It is based on the assumption that the moment of an accident happening, you may not be able to compensate the aggrieved entity. It is therefore necessary that you transfer that responsibility to the insurance company.

Temporary car insurance cover: These often cover a period of not less than a month. You can buy car insurance of this nature when you have a temporary use of the car. It is therefore applicable when you are renting a car, traveling across the states, borrowing from a friend or when you plan to transfer ownership soon.

Whatever the type of cover that you may want to buy, it is important that you seek experts advice and check the legal requirements in your country or state. Also seek to know the cost implications of the cover before you settle on a particular one. It does not always follow that a temporary one would be cheaper, its more expensive in the long run.