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7 Tips on Car Insurance

Owning a car gives you the freedom to come and go as you please, but it also requires responsibility and can be expensive. There is gas and oil, maintenance, tires and of course insurance.

Although coverage requirements vary from state to state, all 50 states have laws that require at least some auto insurance. Generally, the minimum you need to buy is some level of liability coverage. Other types of auto insurance coverage may be optional or required, depending on the state in which you live.  Besides the fact that it is the law, you want to be financially protected in the event that your vehicle is involved in some sort of accident.
Liability insurance protects the insured from the risks of being sued due to damages they caused.

Establish Coverage Needs

Car InsuranceShopping for a car insurance policy is so much easier if you know what you need. Figure out how much coverage you need in order to satisfy state regulations. Knowing what coverage options are available enable you to compare car insurance policies with ease. Taking the time to research the different types of coverage available is invaluable. Take a look at reviews and customer comments on reputable car insurance sites.

Identify Available Coverage Features

It is important to know what your state requires and what risks you are willing to take on your own.

Collision:

Collision coverage, as the name implies, protects your vehicle in the event of vehicular accident, irrespective of who is held liable. Collision Insurance allows you to be reimbursed for damages to your car, based on the terms and conditions of your policy, minus your deductible amount. Collision will pay out,  if the other driver is uninsured, underinsured, or unknown — even if you are at fault. 

But if you are driving a $100 clunker you certainly don’t need to pay $1000/year to protect it against damage.  On the other hand if you are driving a brand new Lexus it would certainly pay to be covered with a small deductible. The tricky part is between these two extremes. At some point, you need to decide that it is no longer worth paying for collision insurance. If you don’t have collision insurance you might consider doing your own repairs on minor things. Since often 75% of the cost of repairs these days is labor. If you find yourself needing discounts on auto parts, coupons from Discountrue.com, can help you find a deal.

Comprehensive:

Comprehensive coverage, also covers damage to your vehicle but it only, protects you from damages incurred from environmental sources, such as hail or a tree falling on your car. Often collision and comprehensive are bundled together since if you car is valuable to protect against one you probably want to protect against the other as well.

Maintain a Good Driving Record

Look at how many tickets you’ve received in the past. Speeding tickets and other traffic violations which tarnish your driving record, will increase your insurance rates.  By maintaining a good driving record you can reduce the cost of your insurance.

Get Multiple Quotes

Don’t just go for the first insurance offer you receive. Shop from multiple insurance providers online. Find a third-party website that compares different insurance companies in an unbiased and in-depth manner. Once you’ve acquired 2 or 3 prospects, request a quote from each insurance company through their website.  Being more financially-responsible about car insurance rates can lead to increased financial health.

Evaluate a Company’s Financial Stability

The insurer’s quote might look attractive, but are they financially sound? Do they treat clients fairly in the event of an insurance claim? Visit the National Association of Insurance Commissioners’ website to learn more about the insurance company.  Particularly, take a look at the complaints they’ve received in the past from clients.  Remember, a company’s financial outlook and attitude affects yours whether you like it or not.

Look for Discounts

Insurers may be willing to give you discounted rates if you’re a member of a particular group or profession, such as army veterans, nurses, teachers, AAA or senior citizen. Some insurance companies even provide discounts to drivers with a defensive driver’s license or whose cars are configured with specific safety features.

Avoid Installment Payments if Possible

Most insurers charge an extra to clients who pay in installments. Based on a survey, insurers charged their clients up to $10 for choosing to pay their bill in installments. If possible, pay your insurance premium on time and in one lump sum.  Besides, you get it off your mind and not have to worry about it at a later time.

There are countless more ways to streamline the process of finding the right car insurance policy, but using tips can provide a baseline for anyone to get started saving money on car insurance and building financial health.

Comments

  1. Ridley Fitzgerald says:

    There is some great information about car insurance here. I hadn’t known the difference between comprehensive and collision coverage. Now I know the difference, and know that it’s probably a good idea to have both.

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