One of the first things motorists should avoid doing is to rush and buy an auto insurance policy without considering what they want to achieve with this coverage. Insurance can protect vehicle owners against possible financial losses and offer them peace of mind. People may initially think that they have to pay high premiums for the protection they need. However, they can find the cheapest insurers for their circumstances by shopping around and take advantage of many discounts they can qualify for to reduce costs so that they can afford the policy they are comfortable with.
Here are the points to be familiar with while purchasing vehicle insurance to avoid mishaps, speed the process and save money.
- Do you have a loan or lease?
When you own your auto outright, it is easier to pick the coverage you like. However, lenders and lessers impose conditions when you have a loan or you leased the car. They usually ask for full coverage car insurance with GAP insurance. Furthermore, there may be upper limits on deductibles so people cannot increase them to reduce premiums.
- Choose a comfortable level of coverage
Even if you own the vehicle outright you still have to make sure your coverage meets your needs. Just buying the minimum state required coverage may be a default choice when you are a young driver with no assets and a cheap car. However, people start accumulating wealth as they move along in life and they may need to protect them with a good level of liability automobile insurance coverage.
Collision and Comprehensive are the most commonly bought additional protections, on top of compulsory Liability. Collision pays for physical damage to your car in case of auto crashes with an object such as a tree or another vehicle. Comprehensive pays for damages to your auto from almost all other causes, including fire, severe weather, vandalism, floods and theft. It also includes broken glass and windshield damage.
Other optional covers include Personal Injury Protection, rental reimbursement and towing and labor. Also, uninsured motorist coverage can either be state enforced or optional. Whichever way, it is a good idea to have it as well.
- What factors affect risk ratings
Claim history and driving records are probably the most influential factors but they are not the only ones. Zip code, gender, age, marital status, yearly mileage and credit history are some of the others to keep in mind. There is not much you can do about age but you can improve the credit score to get better rates. Increasing deductibles can be another tool to bring auto insurance premiums down to more affordable levels. One thing that you can definitely influence is the make and model of the car. Along with personal information, details of the vehicle are very important and therefore, you should keep costs in mind while choosing an automobile.
- Do you qualify for discounts?
The best way of saving money on car insurance is to qualify for as many discounts as possible. They are offered because the chances of claims are low. Here are some discounts you should look for: multiple vehicles, driver education courses, safety devices, anti-theft devices, low mileage, good drivers, and combined purchase of auto/home packages. Vehicle insurers offer different discounts and some of them may not be available in some states. So check with the agent to see if you qualify and get large enough savings. There may be even easier discounts offered for things like paying the premium in full, setting up an automatic payment for installments and even signing the policy documents online and going paperless.
- Don’t buy a policy without shopping around
One of the most commonly given tips to motorists is to shop around and compare quotes. It is essential that you provide the same information each time to get a quote to make comparison easier at the end. Many people may think that automobile insurance companies are similar and therefore their prices will be about the same. However, shopping around is one of the most powerful tools a motorist can have to reduce premiums because each company is so different from each other in the way they consider and price risks.
- Read the policy carefully before putting it away
First of all you need to double check the accuracy of coverage, listed drivers and personal details. Policy documents detail your rights and responsibilities, as well as the schedule of coverage. This contract will be the basis of future dealings with the insurer. You should either download a copy or ask to be posted to you. You may not understand everything written in there as well as a lawyer or a broker would but you would have a good clue about coverage if you read it through.
If you have questions about anything contact the agent for clarification. If there are some changes to be done at the early stages or later, don’t hesitate to contact them. This may not be one of the hottest tips for purchasing car insurance but it is very important nonetheless.