This article will assist you in getting a better deal on car and auto insurance if you’re thinking of buying a car. We will be looking at the basics of auto insurance and how to save money on your premiums.
Auto insurance is something that most people view as an annoying but necessary expense. In today’s economic climate, it can be difficult to pay thousands of dollars for your car to insure. It is easier to view auto insurance as an investment in the future. This is a better way to look at it. The goal of auto insurance is to get the best value for your money, whether you’re looking for complete coverage, liability only, or a combination. You can shop online for cheap auto insurance. But you need to be aware of what to look out for. This is what this article will focus on. You will often find that online auto insurance can help you save money and improve your coverage.
What kind of auto insurance do you need to get for your vehicle? It depends on many factors. There are two main types of auto insurance. They are Liability Only Insurance or Full Coverage Insurance. There are many combinations between the two and you can tailor your insurance package to meet your needs. However, you need to be able to understand the differences to get the best offers.
Let’s take a look at the first type:
Only Car Insurance
The state regulates car insurance. This means that every state has its own laws and guidelines about what type of insurance you must have to be road legal. However, all states have the same minimum requirement: Third Party Liability Insurance. The only difference is how much liability coverage you require. Your liability insurance covers any damage or injury you cause to others or their property. This will most often be damage to another person’s car. By law, you must have insurance that covers your costs. Without liability insurance, you can’t drive any type of vehicle on the roads.
Different states have different requirements for how much liability coverage they need. You may need 25,000 dollars minimum coverage in one state, while 15,000 dollars is the minimum requirement in another. Ask your broker or local traffic authority for information about how much you will need.
You should remember that these minimum auto insurance requirements are legal minimums. Accidents can be costly and easily exceed the minimum insurance required. If you cause damage to 100,000$, it doesn’t make sense to have liability insurance worth 25,000$. You would still owe 75,000$ which is more than most people have. You will need to make compromises as a higher coverage limit can also mean a higher premium.
Full Coverage Car Insurance
This insurance policy is full-coverage and comprehensive. It is completely different from the bare-bones insurance. Comprehensive auto insurance policies cover three areas: Third Party Liability Insurance (also Collision Insurance) and Comprehensive Insurance.
As we discussed, third party liability is the same. Both directions can have limits.
Collision Insurance is an optional add-on you can purchase to protect your vehicle from collisions. If you finance your car through a bank or credit agency, this insurance will likely be required.
Comprehensive Insurance also known as Other Than Collision Insurance. This insurance will protect you from any damage to your vehicle that isn’t caused by a collision. Fire, theft, vandalism, and weather damage are the most common types. Even though the name suggests it doesn’t cover collisions it will still protect you for non-vehicle collisions such as when an animal runs onto the road and you collide with it.
How to Save on Premiums
It seems that there is a lot of confusion over how premiums for auto insurance are calculated. People and certain demographics are stuck with outrageously high premiums. Insurance companies use formulas that calculate the average risk of a person who matches your profile. Your gender, marital status, and age are all factors. New drivers earn more than experienced drivers. Singles pay more than married couples and men pay more than women. This means that young men often pay high premiums, if they can get insurance at all.