For those who are purchasing car insurance, particularly for the first time there are some mistakes that you can make. This is because there is a variety of car insurance coverage present combined with the specific needs of your situation.
Here are the five most common car insurance mistakes you can avoid if you take a little extra time to consider all the options first.
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Failure to Shop Around:
This is arguably the most common of all mistakes as too many people only find one insurance company and never bother to look elsewhere. Instead, you should go online and get free quotes from several different insurance companies. Even if you limit your search to the major carriers, you’ll still find a significant difference in their premiums which may save you a considerable amount of money.
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Paying Per Month instead of Bi-Annually:
When you pay monthly premiums, you are paying more because of the deposit required. Instead, pay the full amount when it is due, and you’ll save an average of one month’s premium for every six months. This is a significant amount of savings that can add up over time.
Believing that You Are Totally Covered:
There is no vehicle insurance policy that offers total coverage. In fact, there are several gaps even in the best coverage that most people are not aware of until it occurs. So, you should discuss with your insurance agent just what is not covered on your vehicle and then adjust your insurance so that it addresses the most likely events. For example, if you live in an area subject to car thieves, then getting theft coverage is probably a good idea.
Sticking with the State Minimum Coverage:
While the state minimum is arguably the cheapest insurance that you can find for your vehicle, in many cases it can be quite insufficient to cover the damage to a more expensive vehicle. For example, if you rear-end a BMW, you may find that the cost far exceeds your coverage, and that puts you on the spot to pay the rest. So, to protect yourself from such situations, consider paying for a higher amount of liability just in case your car hits a luxury model.
A Deductible that is Too Low:
One of the easiest ways to save on your insurance premiums is raising the deductible. Going from $200 to $1,000 may save you upwards of 40% on your insurance payments. Of course, you will need to have that amount tucked away in your bank account in case it is needed, but the savings on your insurance will be so great that it’s more than worth the effort.
By taking a little time to consider the options, you can save a lot of money when it comes to getting the right insurance for your vehicle.