Do you know what you have to do after getting a new car? One of the most important things you should do after buying a car is getting it insured. Auto insurance protects you and your vehicle from legal repercussions in the event of any car accidents. It protects you if you damage another car and will protect your car if it is damaged or stolen. The exact terms of this ‘protection’ will be dictated in your contract with the insurance company which is also known as the insurance policy. In short, your auto insurance will provide coverage for you and your vehicle in case of any damage to yours or someone else’s’ car. You will pay them a certain amount of money in exchange for this coverage. Although this may sound complicated, auto insurance is actually simple once you understand it. Here are 8 important things you have to know before getting insurance for your car.
- Understand how your insurance rate is determined: There are a number of factors that go into determining the auto insurance premium. These include factors such as the car you drive and your previous driving record. Pricier cars have a lower premium while people with speeding tickets and a record of accidents will have to pay a much higher price. Other factors include the car’s mileage and the individual’s location or address. Drivers with higher mileage pay a higher rate as they have a greater chance of getting into accidents. If your local area has a greater number of accidents or vehicle thefts, you will have to pay more for insurance. Identifying these factors will help you choose the best coverage plan for your car.
- You can get discounts for your car’s insurance: In today’s world you can get discounts on almost everything. Yes, that includes auto insurance. Certain vehicles have features or accessories such as alarms and antitheft devices that will lower your premiums. Other features include safety devices, driver education courses and multiple vehicles. Discounts are also given to ‘low risk’ drivers with a good driving record. Always ask your agent if you qualify for any of these discounts. The discounts can help you in the long run when it comes to money.
- Save money by combining policies: If you are thinking about cutting down costs, you can double or even triple up on other policies. It is said that drivers can save up to 10 or 20 percent on their cars’ insurance when combined with a homeowner’s policy from the same company. You can also combine your car’s policy with your life insurance. This also works if you have multiple vehicles that need to be insured. If you are really lucky, you can even get discounts for each policy separately. Protecting all your assets with one company will also help make things simpler and stress-free for you. However, it is important to make sure all the both policies cover your needs.
- Do your research before choosing a policy: There is no ‘ideal’ policy as everyone has different needs for their vehicle. That is why it is very important to consider all your requirements before choosing an insurance policy. This will allow you to make proper decision that you will not regret later. First, you have to understand what you want. Know your priorities and the issues you are willing to compromise on. Also, check out the reputation of the insurance companies you are considering. Don’t forget to check their financial standing as well. You can do this by finding customer reviews and see if they gave many complaints against them. Last but not least, compare insurance quotes for different companies. It best to compare three or more quotes to get an accurate picture. Evaluate these factors to choose the best company and the ideal coverage plan for your vehicle.
- Cheaper insurance can mean less coverage: In some places the insurance rates are pre-set. This means if you take out a cheaper policy, you may not get the coverage you want or need. This can be disastrous in the event of a sudden accident and will cost you a lot of money. If you are still confused, check your area’s insurance department before deciding what kind of policy is best for you.
- You can also get optional coverage: Besides getting the usual liability package, you can also get collision and comprehensive policies. Comprehensive packages are generally the least expensive of the three options. This coverage pays for damage to your car in the event of bad weather, fire, vandalism, explosions, falling objects and theft. It will also pay or reimburse you for broken glass and windshield damage. Despite being cheaper, comprehensive coverage is optional. This is a good option if you are low on money as it covers many damages at a lower price.
- Make sure you are protected: Even after you have chosen a policy and paid the premium, you can make sure you are getting the coverage you have paid for. Make sure your insurance company is licensed so that you have no legal or financial liabilities. In an accident, your policy should pay for any damages made to your vehicle, or any damage you made to another car. It is also important to know how to identify and prevent insurance fraud schemes. Sometimes, accidents are staged in order to get the insurance money. If you suspect such activity, call the police immediately after the accident. Only accept help from someone you have specifically requested. Talk to your insurance company about filing a claim. Don’t talk to anyone else, record suspicious activity and never sign any blank forms. Take down names, phone numbers and registration numbers and remember; you must never admit that it was your fault.
- Read your policy very carefully: Your insurance policy is a contract that has legal bindings for both you and the company. It is written as a contract with conditions that state the rights and responsibilities of both the [parties involved. Read the contents of your insurance policy carefully and make sure you understand everything it says. Read through the policy declaration which is usually the first page of the contract. It mentions the time and amount of coverage and provides basic information about the policy. There are also definitions of common terms used. Also there is an area on policy coverage and policy exclusions. Other areas include insurance limits, special limits and endorsements. The most important part deals with the policy conditions. This tells you the responsibilities of the insurance holder (customer) and the insurer or the company. It will also explain the payment plan and how to cancel your policy if needed. If there is anything you don’t understand, discuss it with your agent. If you are still confused, take it up with your area’s insurance department. Just make sure you understand what the document says before signing it.
As you can see, auto insurance is not as complex as it seems. Insurances will protect you from financial and legal trouble during any unexpected disaster. The most important thing is to do your research properly beforehand. With the right knowledge, you can get the best kind of protection for your car, all at a reasonable price!