What is auto insurance?
I have to make a project about auto insurance.
Can anyone please give me some sort of a brief summary about auto insurance.
I just need something about it so i can write a nice essay. All i need is a short summary of auto insurance.
Like all other kinds of insurance, auto insurance is a risk sharing arrangement. All us drivers out there are at risk for losing something valuable that we really can't afford to lose.
We know that everybody won't crash their cars, yet we know that some will. So we pool our limited funds, then those that need it can get it.
We don't know for certain who will crash, but we use "statistics" to try and predict each driver's degree of risk. If you drive fast, you're more likely to crash; if you drive an expensive car, or one that's expensive to fix, you're more likely to need more in the event of a crash.
If I'm a slow driver with a cheap car, I don't want to chip in as much as a fast driver with an expensive car.
So we contribute money in accordance with how much risk we contribute.