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l be paid by insurance pany. (2)Binding legal contract The personal auto policy has five distinct parts as below. ★ Declarations In this section,declarations should be prepared,and this declarations list all relevant information about the personal auto policy. ★ Insurance agreement This section outlines exactly what the insurance pany promises to provide in return for the payment of the premium. ★ Definitions Every relevant term will be narrowly defined and written into the insurance agreement at this section. ★ Exclusions What,when and who won39。t be covered by the policy will be known in this section. ★ Conditions It lists the duties and responsibilities as the insured in the event of a claim situation. The Effect of the Automobile Insurance The automobile insurance would be beneficial to develop automobile industry,and expend the demand of will iron out both the worries of enterprises and individuals about the purchasing desire. Automobile insurance would also improve the safety property of the self benefit and social benefit,the insurer will statistic and analyze the reason of the accident and research the new automobile safety technology with automobile manufacturer and automobile maintenance that will improve the safety property of automobile. Mo