Auto insurance is a contract between an individual and an insurance company that stipulates that as long as the policy remains in force, the insurance company will pay for vehicle-related losses that have the appropriate coverage for the damage or injury caused by an accident. 

Even though in some states where auto insurance is not required, all drivers who are negligent in an accident are required by law to pay for damage they cause as a result of an automobile accident.  Without auto insurance, you run the risk of being financially responsible for the injury or property damage your vehicle causes, as well as the cost of repairing or replacing your car if it is damaged or stolen.

A variety of different factors affect auto insurance premiums:

Age
Vehicle, year, make and model
Garaging location
Amount and type of driving
Driving record
Coverage required

         What coverages are mandatory in Michigan's No-fault Auto Insurance Policy?

          Residual Liability  

Covers accidental bodily injury and property damage to others when the named insured is held legally responsible. Liability coverage also pays for defense and court costs.

Personal Injury Protection 

This coverage is unpresidented in the scope of protection provided to injured family members of the named insured's family.  Medical expenses are unlimited in time or amount of money and disability payments are paid at a rate of 85% of an gross individuals income for up to 36 months.

Personal Property Coverage

$1,000,000 is available to pay 3rd party claims for property damage to stationary objects caused by the named insured's vehicle.  Examples of stationary would be a legally parked vehicle or a building. 

What Optional Coverages Are Available?

Uninsured/Underinsured Motorist Coverage
 

This coverage protects your family members for serious bodily injury if their injuries are cause by an at fault driver of the other vehicle.  Negligence must be proven in a court of law.  The negligent driver's vehicle must have no insurance in force or their Bodily Injury coverage must have lower limits than your policy.

Comprehensive Coverage
 

Repairs damage to a covered vehicle if damage is caused by fire, wind, floods, theft or any number of other perils.  This coverage excludes loss caused by a collision. A deductible maybe required.

Collision coverage
 

Repairs damage to your vehicle when this coverage is a part of your auto insurance policy.  A deductible may apply, with these exception: Limited and Broadened collision waives the deductible if the driver of your vehicle was less than 50% at fault in causing the accident.

Rental Reinbursement  

Pay for a rental at a daily rate you specify if your vehicle is in the shop for a covered physical damage loss.

Towing

Provides payment of roadside assistance cost you sustain do to a vehicle breakdown.

Loan\Lease Coverage

In case of a total loss this coverage will pay the difference between the actual cash value of your vehicle at the time of a loss and the balance you owe the Bank or leasing company.  

Purpose:  Today, with no downpayment and long term financing a vehicle will drepreciate faster than the principle of a loan can be paid down.  This coverage pays this difference in values so you will not have to encure this additional expense when you can least afford it.