Carrying auto insurance is necessary for anyone who owns or operates a vehicle. However, it can be a challenge to find the cheapest insurance and figure out exactly what kind of policy to purchase. Car insurance isn’t the simplest thing to understand. Between legal requirements, optional coverage, deductible choices, and different coverage levels, it’s not always easy to figure out how to choose the best auto insurance policy. Choosing the right policy for you does not have to be a daunting task.
Do you need full coverage or liability only?
If your car is new, leased or purchased with a loan, you’ll probably need “full coverage.” In case of an accident, these coverages will help protect your car and the other driver up to the limits shown on your policy.
The minimum, full coverage policy includes:
- The Standard Liability protection
- Both Collison and Comprehensive coverage
Unless a third party requires full coverage (standard in many loans and leases), you can choose to carry “liability only,” which typically only protects the other driver and their vehicle in case you are found at-fault for an accident. It’s a good idea to make sure you can afford to replace your car out-of-pocket when considering this option.
Understanding Insurance coverages
Most states require bodily-injury liability insurance to cover medical treatment, rehabilitation and funeral costs incurred by your own passengers, other drivers, their passengers and even injured pedestrians. Other costs covered include lawyers’ fees and non-monetary losses related to pain and suffering. State minimum-coverage limits are too low to protect the assets of most motorists. Unless your income and assets are minimal, buy at least $100,000 per person, $300,000 per accident.
Property-damage liability covers repair or replacement of other people’s cars and property. State minimum limits average about $15,000. With the average cost of a new car at $25,000, however, buy at least $30,000 in coverage.
When a hit-and-run driver, or someone who’s inadequately insured, strikes your car, uninsured-motorist and underinsured-motorist coverage pays for the medical, rehabilitation, funeral, and pain-and-suffering costs of the victims in your car. This crucial coverage also insures your household members as pedestrians. Buy this coverage at the same limits as your bodily-injury liability coverage.
If your budget permits, consider the following options:
Collision Insurance pays to repair or replace your car after an accident. If you have bought a new car with a loan, you’ll be required to buy this coverage.
Comprehensive pays if your car or its contents are stolen, or if your car is damaged by fire, water or other perils. Lenders will also require this coverage.
For both, you’ll have to choose a deductible: a dollar amount you fork over to the repair shop before the insurer antes up. The higher the deductible you carry, the more you’ll save. Try to carry a deductible of at least $500 on each coverage.
For cars worth less than $5,000, comprehensive and collision probably aren’t worthwhile. Over time, the premiums you’ll fork over will probably exceed the payout, even if your car is totaled. Plus, in an accident that isn’t your fault, you can figure that the other driver’s insurance will cover your car. (To estimate your car’s market value, consult the Kelley Blue Book.)
Compare Auto Insurance Companies
Do not pick the first insurance company or the cheapest auto insurance you come across. Every company uses its own formula, based on your driving record and your responses, to evaluate your insurance premium. By shopping around and getting several car insurance estimates, you can save a significant amount of money on your insurance. An auto insurance broker can save you time by doing car insurance comparisons for you.
What about discounts?
Want to save even more? Many insurance companies offer discounts that can further lower your auto insurance costs. Discounts can include these options:
- Vehicle Equipment
- Clean Driving History
- Drivers Education
- Driver Affiliations
- Customer Loyalty
- Multiple Policy
- In some states, Good Credit
National Auto Insurance
Think long and hard about what type of insurance coverage is needed. There are many different levels of coverage, and it can be confusing having to decide how much you need. Your auto insurance broker can guide you through that and help you find cheap full coverage auto insurance.
For more information, please call 800-459-6060 or visit our website for free car insurance quotes online at: www.InsuranceBrokersGroup.com or Click Here