A car insurance company is an organization that provides cover on an automobile against any loss. This means that in case of any accident, the company will compensate any financial loss. To have this cover, a person is required to pay a fixed amount periodically to the company. This is known as premium.

Insurance companies generally charge a flat per-car/per-year price. The insurers pay this amount, also known as a premium, to the insurance company. If the policyholder places a claim against the insurance, the company reimburses the claim from the funds raised by collecting such premiums. When buying car insurance, the customer is protected in different ways, depending on the type of coverage purchased.

It is against the law to drive without car insurance in almost all of the states. People are always looking for better and cheaper options, as insurance can be expensive. There are many leading car insurance companies that provide car insurance at competitive rates.

A car insurance policy term is generally six months. People have an option of renewing their current policy or going with another insurance provider every six months. This is why retaining customers and constantly securing new customers are major areas of focus for insurance companies.

To do this, the companies adopt many strategies. They divide their customer base on the basis of multiple parameters. They offer attractive discounts to people who have a good driving history. Their point is to encourage better and safer driving. Customers with a poor driving record and, sometimes, bad credit history, are charged more and are put in a “high risk” category. Also, most of the companies offer discounts to students, senior citizens, people who have been with same company for long time and military personnel. For customers in active military duty, they have special policies.

A major cause of concern for car insurance companies is fraudulent claims. People report false accidents and losses to get money from their insurance companies. To check this, insurance companies have their own investigators. Also, they offer discounts to people who make very few or no claims. This is done to discourage people from filing claims for every small or big amount.

Some of the major car insurance providers are Allstate Insurance Company, State Farm Car Insurance, AIG, Safeco, Unitrin Direct, MetLife and Amica Insurance. Most of them offer 24/7 customer service and can be reached through their Web sites and their 1-800 customer service numbers.