Car Insurance History

Insurance is hardly a new idea. Indeed the concept can be traced as far back as the ancient Chinese used to protect their investments with marine insurance, which is still used today.

Once people began operating automobiles on public property, policymakers decided that it was a privilege rather than a right and started to require drivers to purchase auto insurance in order to protect unsuspecting third parties from injury or property damage.

In 1895, liability coverage first began to be offered with auto insurance when the first car insurance liability policy was issued by an English company. In 1898, the first such policy was sold in the United States to Truman J. Martin.

Car insurance policies were officially required by law until 1927 when Massachusetts became the first state to do so. Since then, every state has introduced mandatory car insurance in some form or another. Though liability requirements vary from state to state, they all require some minimal form of liability coverage to protect innocent victims.

To find information on car insurance requirements in your state, the Department of Motor Vehicles (DMV) is an excellent resource. You can also visit the DMV web site to find information on insurance companies.

Becoming familiar with the car insurance requirements of your state is important because it helps you carry the appropriate level of coverage. If you do not carry the right coverage, an accident could result in fines, suspended license, and/or jail time. Another result of carrying too little coverage is that an accident could cause bodily injury to someone else, and a lack of liability coverage could cost you everything, from your car to your very home.

Car insurance is not a luxury. It might seem like an unnecessary precaution if you drive carefully, but a convenient monthly payment is a small price for the security of knowing that if the worst should happen, you will not be liable for the hundreds of thousands of dollars that a settlement could come out to.