Car insurance is a bill that we’d rather not pay, but we have to if we want to stay safe on the roads. It won’t necessarily stop us from having an accident, but it can stop us from being left in the lurch if the worst does happen. Everyone who owns a car must insure it by law, even if you don’t plan on driving it for a while. You have lots of options when it comes to the kind of policy you buy and where you buy it from. If you’re feeling a little intimidated by all of the information out there, use this guide to help you:
What Kind of Policy Should You Buy?
In America, you’re required to have insurance. However, you aren’t required to have that much by law. Liability insurance is all you need to cover your car damaging other cars and people. But should you stop there? If you’re being smart, the answer is no. If you want to protect your finances, as well as cover your own injuries, you should get a better insurance policy. If you get the cheapest insurance policy possible, you won’t even be covered if somebody who doesn’t have insurance hits you.
In an auto policy, you’ll see this kind of coverage:
- Uninsured motorist – this will cover you and damage to your car if somebody who is not insured hits you.
- Medical payments – this will pay for medical expenses and sometimes even funeral expenses if needed.
- Comprehensive – this will cover you for damage caused from something other than a vehicle, theft for example.
- Collision – covers you for collision with other vehicles.
- Property damage liability – covers damage your car causes to property.
- Bodily injury liability – pays medical expenses for people hurt in an accident you’ve caused.
Bear in mind that if you cause accidents and drive recklessly in general, you will more than likely receive points, fines, and perhaps bans. This can mean you need an sr22 insurance policy. Sr22agency.com is a new site with an awesome sr22 insurance guide. Hopefully you won’t need one, but it will help to understand what it is.
People Covered by Your Insurance
If someone is going to be driving your car regularly, other than you that is, their name needs to be on the policy. You could end up losing your policy if you let other people drive the vehicle. It’s always best to include them on your policy, just remember that your premiums will become higher if they have a history of bad driving.
Telling Your Insurance What You Use the Vehicle For
You need to be honest with your insurance company about what you’re using your vehicle for. If you lie and get found out, you have committed a fraud. It might save you a bit of money, but you won’t be covered legitimately, and you could get into a lot of trouble. It’s not worth it.
Getting Fully Comp Cover
People associate fully comprehensive insurance with being the most expensive, but this isn’t always the case. As the lowest form of insurance used to be the cheapest, more and more young drivers select it. This has caused the cost to go up, as young drivers are making more claims. It’s definitely worth checking out all forms of insurance when finding the best deal, but you need to make sure you’re covered adequately too. Think best value for money, not just cheap.
Fully comprehensive insurance will vary from company to company. Some will include helpful extras, such as windscreen damage, while others won’t. Look out for these to see where you’re getting the most value from your cash:
- Windscreen damage cover.
- Courtesy car.
- Breakdown cover.
- Legal cover.
Renewing With Your Current Insurer
Staying with your current insurer year after year might be the easy option, but it’s definitely not the best value for money. Insurers know that the majority of people won’t bother to search for a cheaper policy; they’ll just carry on as they are and hope for the best. Shopping around for insurance shouldn’t take you too long, and you should be able to find some great deals. You can then call your insurer and see if they will match/beat the quotes you’ve found. If not, you can switch. Use a comparison site so you don’t have to check out all of the insurers separately.
Lowering Your Excess
Many people get tempted to make their excess as high as possible in the hope that they won’t ever have an accident where they have to pay it. However, you never know what’s just around the corner. You need to weigh up whether it’s worth paying the price you’ll pay to cover the damage, or whether you’d rather pay a little more each month/year to have it sorted out for you.
Notifying Your Insurer of Changes
By law, you need to notify your insurer if there is any change in your circumstances. They need to know if you’re driving your car for different reasons, and even if you’ve started parking it somewhere else. If you don’t bother, any accident you claim for could be classed as invalid and you won’t get any help.
Paying Up Front
If you can get the money together to pay up front, you’ll pay a lot less. You pay interest when you pay each month, so you end up paying significantly more in total. The interest charge for monthly payments could be as high as 30%.
The Difference Between Adding Drivers and Fronting
Adding another driver could be a clever way of reducing the cost of your insurance. However, declaring that they are the main driver of the vehicle is illegal. This is something called ‘fronting’, and can make your insurance invalid. Those involved may also get fines and penalty points.
Hopefully you now understand car insurance a little better, and know what to do when it comes to your policy. Most importantly, make sure you drive safely!