Owning a car comes with a few extra responsibilities than just having a license to drive it. Before taking your car out onto the road, you need to make sure that you have adequate car insurance.
Many car owners have a grudge towards paying for car insurance. It can feel like you’re paying for something each month that you never get to use. But trust us, when you do actually need to use it, it is well worth it!
First step however, is actually selecting and buying the car as this will affect the type of insurance that you need to get. If you’re struggling with securing a car loan due to a bad credit rating, have a look at the different bad credit auto loans at Crediful.com.
Then comes the car insurance. Buying car insurance can get a bit more complicated than just looking for the best price. A few other factors come into play as well.
To help ease the process, here are 10 things to know about car insurance:
1. There are different types of car insurance:
Liability Insurance (also known as Casualty insurance) includes bodily injury liability. Which means injuries you cause to somebody else and property injury liability, which refers to damage caused to someone else’s property, including other vehicles. Other types of car insurance include No-Fault Insurance and PIP, Collision Insurance, Comprehensive Insurance and Loan / lease pay-off.
2. Liability insurance:
Liability insurance is compulsory in the US, however the level required varies from state to state.
3. Shop around:
This goes for when you first start looking at taking out car insurance as well as reassessing your current cover. Compare different policies and look for different ways that you can save. For example, with some insurers you can save by combining your car insurance with a home insurance policy.
4. The car that you drive can affect your rates:
The make, model, color and year of your car will affect your car insurance premium. This, along with how likely your car is to be stolen and how much protection it offers occupants, are factors which can bring your car insurance premium up or down.
5. Your lifestyle can affect your rates:
The use of the car (for personal or business), where the car is parked during the day and at night, how old you are and any previous claims will affect your car insurance premiums. For example, city vehicles are typically subjected to more break-ins, theft and fender benders, and are therefore more expensive to insure than ones in rural areas.
Most car insurance companies will also offer discounts for things like a safe driving record, car safety features, anti-theft devices, electronic payments, payment in full, and more. These can make a huge difference.
6. Don’t let your policy lapse:
Insurance companies see drivers without valid car insurance as irresponsible and risky. If you let your policy lapse, you may end up paying more when you go to buy car insurance. This can happen when you are planning on letting your current policy expire because you want to switch car insurance companies. To avoid this, make sure to purchase a new car insurance policy before your current policy is cancelled.
7. Not all things are covered in car insurance:
Normal wear-and-tear, car services and intentional damage are not covered by car insurance. Make sure to read your policy schedule for anything else that is specifically excluded.
8. Choosing a higher deductible:
The word “deductible” refers to the amount of money you’ll have to pay out of pocket, following an accident, before your insurance kicks in. While selecting to go with a higher deductible will lower your premium, you need to make sure that you have emergency funds available should your car get in an accident. If you can afford it, a low-deductible plan will ensure that you won’t have to pay too much for auto body work or car repairs after being in an accident.
9. Extra’s:
Most car insurance companies will include a few optional extras in your insurance policy – some are included for free while others may require an additional charge. These include car hire, roadside assistance or even pick-up services.
10. Things to tell your insurer:
As you go through major life changes, you will need to notify your insurer as they may affect your insurance policy. These major life changes include getting married (this could lower your monthly premium), changing jobs (you will need to update the address of where your car is parked for most of the day) and if you move houses (again, to update your address).
Getting car insurance is one of those necessities in life. While it can seem complicated, it really doesn’t have to be. Insurance agents are there to take you through the process.
