The history of car insurance dates back to the time when the use of motorcars was widespread. After World War I, cars were used mostly in urban areas. Cars were fast and dangerous vehicles to travel with. Yet there was no compulsion on car insurance as it is now. The drivers often faced huge financial injuries when there were accidents along with the damage of life and property. The UK was the first company to introduce a compulsory insurance scheme. The Road Traffic Act came into being in 1930 and since then, car insurances have come into existence.

What are the coverages under car insurance?
Car insurance provides coverage for the following:

• Property : Damage of the insured car or theft of the insured car.
• Liability: Legal issues related to injury and damages to the vehicle.
• Medical : Treatment, wages, and other expenses related to the death of the owner or the driver of the insured car.

Most of the states have compulsory auto insurance but some laws vary from state to state. Even auto insurance coverage is individually priced and the amount can be chosen according to the budget. Needs and budget of the car owner are mandatory for all insurance expenses. Policies are generally renewable and the company will notify before the expiration date of the policy.

What are the other types of typical car insurance coverage?
Most of the auto insurance is legally mandated and covers all the damages which are caused by the insured car. It does not cause automatic engine faults of other damages which crop up in the car. To cover the damages of the car of the owner, the following optional coverages are considered.

• Collision damage : It refers to the damages that happen to the car or the owner as a result of a collision with another car or a strong object like a tree or pole because of the fault of the owner. It does not cover natural calamity. The normal depreciation of the car or mechanical damages will not be covered. Accidents due to potholes will be covered.
• Comprehensive damage: It provides coverage against damage caused by theft or any other type. It does not cover damage caused by collision, fire, and other natural or forced damages.
• Glass coverage: It provides coverage from damages involving glass pieces. Windshield damage is one of the most common types of damage. Some companies provide glass coverage. It includes a side window, rear window, and glass sunroof coverage. If the insurance company does not provide for this, then the coverage can be bought.

What is gap insurance and when is it needed?
Collision and comprehensive policies only cover the exact market value of the car. It will never reimburse the entire cost price of the car. Cars depreciate quickly and the amount received is still less worthy. If the car is sabotaged or has been under theft, then there arises a ‘gap’ between the insurance coverage and what the value of the vehicle is. To cover this, gap insurance can be brought.