Car Insurance Explained
While you may not think about it very often, car insurance is something which everyone needs. You don’t think about it much; until you really need it, that is. However, most people have no idea whether or not they are getting a good deal on their car insurance. If you educate yourself about car insurance and what to expect from a policy, you can avoid being convinced to buy a policy which you really don’t need.
The minimum coverage required by the states varies, and so do some wording in the no-fault insurance states but the concepts are the same everywhere.
The first part of your policy is the collision and comprehensive coverage, which covers the automobile itself. Collision covers those trees which jump in front of your car and rude drivers who put their cars in the way of yours. Comprehensive includes damage and theft (hail, falling trees and the like).
The second section of the policy deals with your liability, the other guy?s damage if you caused the accident. The amount of coverage shows up in numbers. 25/50/10 for example means that the company won?t pay more than $25,000 per person and $50,000 total per accident. The 10 stands for $10,000 for property damage per accident.
Medical coverage protects everyone involved in an accident, regardless of who was at fault in the accident - this part of your policy even covers you if you are hit while walking! Medical coverage will cover you of you don’t have health insurance and will also cover the costs which your health insurance does not cover.
There will also generally be coverage in your policy to account for uninsured and underinsured drivers, which covers you if someone with no (or inadequate) coverage hits your car. This part of the policy also covers hit and runs, Towing coverage can also be added to your policy if you opt for liability as well as comprehensive and collision coverage for a low fee.
You can save a lot of money on car insurance by keeping these rules in mind:
1. Before renewing your policy, get some different quotes and compare the prices. There are a lot of websites which let you do this all form the comfort of your own home or office. Be sure to look for quotes for insurance with the same coverage as you have already.
2. See if your home insurance company offers a discount for buying your car insurance from them as well.
3. Ask if any discounts are available. There are often discounts available for drivers who have higher premiums (such as young drivers) who maintain good grades (if students) or for those who take additional driving courses.
4. You may not need to carry full coverage for your car. If you don’t have a loan you are paying on the car, you can sometimes save a lot of money by dropping the comprehensive and collision portions of your coverage. Compare the payment your insurance policy will pay out against the Kelly blue book value if your car is totaled. If this cost is higher than two years of premiums, you might want to consider dropping this part of your policy and using the savings to buy a newer car. However, keep the liability insurance - it’s important.
5. Think about getting a beater and using it for commuting and short trips. You can carry full insurance on your good car and carry only liability insurance on the beater. You can save money on your insurance and wear and tear on your good car this way.
Leave a Reply