While buying auto insurance may not be one of life’s greatest pleasures, we all need it. Whether for state law requirements of for peace of mind, here are some things to keep in mind when buying auto insurance. These tips are helpful for the first-time auto insurance purchaser or a lifetime customer, so pay attention and you could save yourself money as well as headaches!
There is a lot of Industry Jargon
When you ask an agent about auto insurance they will likely ask you several questions, these questions will probably be ripe with auto insurance industry jargon. Do not fear, here are some definitions of common auto insurance terms. Liability Coverage is usually the bare minimum of insurance required by law, this ensures in case of an accident the damages to other’s vehicles and persons will be covered. Comprehensive Coverage covers your vehicle as well any other in accident, it can also cover damage from non-accident related damage such as storms or theft. Another common term you will hear is deductible, the deductible is the price you must pay out of pocket after an accident before the insurance company begins to pay. For example if you Comprehensive Coverage with a deductible of $400 and a premium (monthly bill) of $158 and your car had $2000 dollars in required repairs from a falling tree, you would be expected to pay $400 before the company picked up the remaining $1600.
You Won’t Pay the Same as Others
Insurance premium rates are not one size fits all. Unlike car payments or gas prices, insurance companies include personal factors about you and your driving to determine how much you will pay per month. The type of vehicle is a major factor, cars that are prone to accident or theft will have higher premiums and deductibles. Where you live and work is also a factor and soon the route you take could be considered as well. Your driving record, which includes any previous traffic violations or accidents, also plays a big role in auto insurance pricing. The primary driver’s age and gender will also influence how much they are charged. There are also surprising discounts for things such as a discount for policy holders who have good grades or are willing to take additional drivers safety courses. With so many factors it is unlikely your insurance rates will be the same as your neighbor, sister, or cousin. So just because you have a similar policy do not expect to pay the same.
Be sure to keep our tips in mind when buying auto insurance. If you understand the auto insurance lingo you will know what the agent on the phone is talking about. Also, be aware of all the factors that effect that can affect your monthly premium, the factors that are in your control you may want to correct before shopping for auto insurance but some factors, you cannot change. Keep these things in mind and good luck shopping for auto insurance policy.