If you’re like most people, your face will probably be swollen every time you write a check to pay your car insurance premium. You hate it, but you also realize that you need it, even if your state doesn’t require it.
Although it might seem counterproductive for some to purchase car insurance that is only activated when something goes wrong, this insurance policy will give you protection and peace of mind. The costs of personal liability, personal injury, and property damage in an accident can quickly rise to six figures, sometimes more.
It is surprising to see that most people know that they need car insurance, but very few understand the details of car insurance. Instead of getting the information they need they keep writing those quarterly or monthly checks like a clockwork. This mentality has led to many consumers paying more for car insurance than they should.
Bodily injury liability is one of the most important coverages that you can add to your car insurance policy. This coverage covers injuries you or someone else sustain in an accident. This coverage is almost unaffected by the fact that you are a safe driver. Many states have no-fault policies that allow for the liability of both parties in an accident. If an accident is your fault, they will call it an “accident”. It was not your fault, it was an accident.
Comprehensive coverage covers you for things such as fire and theft. You will need collision coverage if your car isn’t paid off. In fact, your car loan lender may require you to have this coverage until your vehicle is paid off. You can also choose to add rental car reimbursement or towing coverage to your car insurance policy.
Each coverage will have a deductible. Your car insurance premiums will rise if your deductible is lower. This is because there are more chances that the insurance company will have to pay out. A $500 deductible could mean a premium difference of up to three times.
It is important to shop around for the best rates on your car insurance policy. You should shop around for the best rates and coverages. Just because an insurance company offered a great deal 10 years ago does not necessarily mean they are the most cost-effective option.