How Car Insurance Works

For those wondering why it matters to have Car Insurance, I will explain to you why it matters and why it can save you BIG TIME if you were to be involved in a common situation.

First things first, what is Insurance?

Insurance is basically an arrangement by a company whom provides a guarantee that you will be compensated for damage, illness, death, and loss, in return for a monthly payment.

Now if we combined "Insurance" and "Car", you can already guess what it means.

BASICALLY, If you're in a car accident, the Insurance company that you pay your monthly fee to will give you compensation for whatever you lost, depending on the situation of course. For example, if my Car is parked, and someone crashed into my Car, that person's Insurance Company would have to pay for the Damages. If I was INSIDE the car and I was injured, I am eligible to sue that person.

However, If 2 Cars crashed into each other, both of the Drivers' Insurance Company will go 50/50 in terms of compensation.

Here's the tricky part, like I said it depends on the SITUATION. If 2 cars crash into each other and it's both of the Drivers' fault, they will try to find the person who's most responsible for the accident, then go 60/40. If 3 drivers crash, they will have to find out who's the person most responsible, then it would be something like  60/20/20.

Understand now? Whether you will get compensated or in the Dog House is based on real-world situations and what happened.