Car Insurance companies are financial institutions that underwrite risks of damages and losses to your car. They focus mainly on risks that can emanate from using your car on public roads. There are different policies that can be purchased and they all cover different risks for your car.
Depending on the risk you want to cover, car insurance companies have the terms that guide whatever risk of damage or loss to your car that you want to cover. The car insurance companies issue these covers in exchange for regular payments known as premiums from the policyholders.
Generally, car insurance covers the potential loss or damage to your car depending on the policy you purchase. In Nova Scotia, it is mandatory for drivers to have car insurance. In this article, we will be discussing some of the most reputable car insurance companies in Nova Scotia.
If you’re looking for coverage, be sure to use a reputable brokerage, like Surex, if you want to find quotes for car insurance in Nova Scotia. A brokerage is a group that works with a variety of insurance companies in order to provide policyholders with the best product.
How Do Insurance Companies Work
The primary purpose of an insurance company is to protect the policyholders from potential loss or damage to what they have purchased a cover for. The payment is either made to you or on your behalf to beneficiaries or third parties, depending on the risk that is being covered. In an insurance policy, the risk is transferred from you to the insurance company.
However, you must have made insurance payments to cover this risk in the form of what is known as a premium. The insurance company pools these funds together to pay for the loss or damage, whenever it occurs.
For example, if you insure your vehicle against damage or theft, the insurance company is obliged to pay for the repair or the replacement of the car. To further explain how the premium works, here is an illustration.
If you buy an insurance policy for your car in the sum of $10,000 and the premium for that cover is $1,000. Should the car get physically damaged or stolen, the insurance company must pay the full $10,000 towards the repair or replacement of the car depending on the claim you filed. A premium is paid annually to the insurance company and in the event that nothing happens to your car throughout the year, your premium is not refundable.
Insurance companies use probability and the law of large numbers to determine the cost of insurance premiums that it charges policyholders, depending on the risk being covered. The insurance companies find a way to balance it by making sure the rate charged is sufficient for them to pay for claims filed, and the resulting expenses, and also make a reasonable profit from it. They do all these without turning away customers.
The more likely damage or loss will occur, the more the insurance company must collect the premium to be able to pay for the anticipated claim that will arise from damage or loss of what has been covered under the policy.
Types of Car Insurance
Your car is an important part of your everyday life and one could wonder what you can do without it, especially if it becomes unavailable unexpectedly. Anything can happen to your car at any time which is why it is always advisable to have insurance cover for your car. There are different types of car insurance that you can subscribe to for your vehicle. Some of them include:
Third-Party Liability Coverage – Third-party liability coverage is a type of insurance that covers your car when there is a reason to repair or replace a damaged third-party vehicle for which your car is responsible. It also covers third-party injuries that occur from the use of your car. This type of insurance is basically a cover against liabilities that accrue to third parties which have been caused by your car.
Take, for example, you could hit another road user and damage their car and injure the passengers. The type of car insurance covers the repair and replacement of the car, the injuries of the third parties, liabilities from the death of the third party, and even legal expenses that may arise from such an accident. It protects you from out-of-pocket expenses in the case of an accident involving a third party vehicle and every liability emanating from it.
Personal Accident Coverage – This is the opposite of third-party car insurance. In other words, the cover that is provided under this cover is for yourself. This covers the repair or replacement of your car and any medical bills you may need to take care of yourself in the event of an accident.
Collision or Damage Coverage – Collision or damage coverage is a type of car insurance that covers the cost of repairs to your car for parts that have been damaged after a collision. This covers any damage to your car in the event of an accident with another road user. For coverage for the third party, you need to have a third party insurance cover. To calculate this type of coverage, both the age of the car and the Insured Declared Value are used.
Comprehensive Car Insurance – This is a type of car insurance that covers your vehicle to the highest level. It includes third-party car insurance, damage to your vehicle, personal accident cover, and other non-collision damage caused by events like extreme weather, theft, and fire. You have the options of other add-on car insurance covers.
Three of the Best Car Insurance Companies In Nova Scotia
You can get some of the best car insurance in Nova Scotia from the following car insurance companies:
Aviva Insurance – This is a top insurance company in Nova Scotia that offers multiple car insurance policies that you can purchase for your car. They also give you the opportunity to save 10% on every vehicle you add to your policy.
Pembridge Insurance – This insurance company offers to cover all the mandatory car insurance covers you must have as a driver in Nova Scotia. It offers covers such as collision, specified perils, and loss of use for your vehicle.
Wawanesa Insurance – The auto coverage package of this insurance company covers the mandatory car insurance cover and add-ons you may need for your vehicle. They use factors like vehicle usage, the number of drivers of the vehicle, and the type of vehicle to determine the cost of insurance. You are sure to get the best out of it.