Things to Avoid When Purchasing Auto Insurance
Things to Avoid When Purchasing Auto Insurance
Most people have negative feelings about their auto insurance: They're required to pay for a service that they may never use. The law requires drivers to have auto insurance, there are many misperceptions about it that may influence the choices you make when buying your policy. Here are five mistakes to avoid - before you buy auto insurance.
1) PURCHASING YOUR LIMITS BASED ON THE MINIMUMS YOUR STATE REQUIRES RATHER THAN THE TYPE OF VEHICLE YOU DRIVE.
No question it's important to be legal - companies won't sell you auto insurance below state minimum requirements, but selecting just those minimums may leave you with the risk of large out-of-pocket expenses if you ever have a claim. If you drive a SUV and you hit another vehicle, the damage could be massive. In California the state only requires a $5,000 minimum for property damage and you cause $20,000 in damage to a BMW or Mercedes, guess who's responsible for the remaining $15,000? Yup: You are, not your insurance company. It is in your best interest when choosing your insurance limits; consider the size and weight of your vehicle and how much damage you could cause if you hit another vehicle. If you're not prepared to pay large chunks of money out of pocket, you may want select higher limits.
2) BUYING YOUR POLICY BASED ONLY ON PRICE ALONE RATHER THAN BY WHAT IS OFFERED IN THE CONTRACT. If you get several auto insurance quotes and you base your choice on who charges the least without examining whats included in the offer for the premium, you might be selling yourself short. make sure your quotes are as similar as possible to see what the best price and best coverage, and choose similar limits across all quotes to compare apples to apples. Also, consider a company's availability before you purchase your policy. What good is a company that has no customer service--none!
3) NOT DISCLOSING UP-FRONT ABOUT YOUR DRIVING HISTORY.
If you don't disclose tickets, accidents or other moving violations during a quote, your rate will not be accurate. The price may be attractive at first, you will be in for a surprise when you actually purchase the policy. Insurance companies will find out about driving histories because they check your driving records, and they'll will adjust the price of your policy accordingly or worse yet cancel your policy. So it really is to your advantage to tell your agent about your driving history up-front to get a more accurate rate.
4) ASSUMING ALL AUTO INSURANCE COMPANIES ARE THE SAME. THERE NOT.
While insurance companies are regulated on a state-by-state basis, not every insurance company will offer the same products and coverage's in a given state. Before you select a company, make a list of what's important to you. Is it availability, price, convenience? Repair shop options? Types of parts used? Some may use after market. Once you have your list, ask each agent about the items on your list to see who can meet your needs the best.
5) CHOOSING INSURANCE COVERAGE'S THAT COULD BE AVAILABLE THROUGH OTHER AVENUES.
You may have duplicated elsewhere before you buy your auto insurance policy. For instance, you may have AAA, towing many be covered if your vehicle breaks down on the side of the road. In these cases, you wouldn't need to purchase Roadside Assistance coverage on your insurance policy since you'd be covered for towing elsewhere. If you're on a budget and already have health insurance that covers injuries caused in an accident, you may be able to bypass Personal Injury Protection , but only if they're not required by law in your state. If you've customized your car with custom parts, you may not need Custom Parts and Equipment coverage during the first year. Do you have a warranty policy that covers GAP coverage, you may not need Loan/Lease Payoff coverage through your insurance company if you've already purchased it through your finance company.
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