Car insurance is as essential as petrol is to make your car go. It would help if you had the protection of car insurance, but with all the options out there, it isn’t very easy to navigate the waters and make the right choice for your situation.
Insurance can be costly, and factors that lead to the costly nature of insurance include:
– A person driving record
– Your credit rating
– The age of your car
– The model of your car
– The length of time you have been driving
If you are new to insurance, or just looking for some guidance, here are six tips to help you make a better choice when shopping for insurance.
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1. Sit down and figure out what insurance you need
Insurance can be complicated, but you should know the minimum requirements (for insurance coverage) before you sit down to look for insurance. Assess your current vehicle. However, it doesn’t matter if the car is 20 years old, having comprehensive car insurance is probably much needed.
Remember, so long as you have the minimum required coverage, you are okay in the eyes of the law, but what you have to think about is the costs not covered by insurance. If you are at fault in an accident and you cause $25,000 worth of damage, but your liability is only suitable for $15,000 then where would you get that money?
2. Don’t be afraid to barter
Car insurance is big business, as such, there are many companies out there fighting for business. Take some time to call around and get some quotes. Once you have at least 12 quotes, narrow them down to two or three quotes in your preferred price range and then begin the process of playing them against each other to see what you can get.
It is important to note that, if you have not so good credit, this will affect your premiums. Insurance companies use a specific car insurance score based on many factors, including accident and claim history and credit report information.
3. Ask about discounts
There are lots of different discounts you can get, and they include the following:
– Safe driver discount
– Accident forgiveness
– No tickets discount
– Defensive driver course discount
– Employee discount
– Discounts for doctors, nurses, teachers or masons
The list goes on, but there is usually a discount or two; even for the average joe.
4. Use an insurance broker
If you are just not sure where to start, then why not consult an insurance salesperson. With a broker, you can often get access to deals not always available to the public. This is because they have long-standing contacts and have worked out discount deals for their clients.
Using a broker is an excellent option for those who are at a loss, but they may charge a fee for their services, so make sure to discuss the costs -if any- before you proceed to use their services.
If you do decide to engage in the services of an insurance broker, it should be no surprise to you that they will try to sign you up for the most expensive policy out there. This is because their commission is dictated by how much insurance you buy.
5. Consult with friends; you might get a better deal
It is always a good idea to consult friends and family for tips on insurance. If you are young and do not have good credit, you may be able to convince them to add you to their policy or your parents’ policy to get a cheaper rate. Many companies offer deals for referring friends to them for insurance so that you may get a good deal through that avenue.
6. Think about your deductible
Ideally, you never want to use your insurance, as such you want to have the cheapest insurance you can. If you are looking for the best deal possible, then you might consider a higher deductible to get a lower rate on premiums.
A good range for a deductible is anywhere from $750-$1500, but the higher you go, the less the premiums will be. If you take a higher deductible, this means that you have to cover more of the repairs, or you may not get enough money to repair your car in the case of a wreck.
If you have a sports car or a brand new car, you are going to pay out the nose for insurance. If you have financed a car, the finance company or bank will require you to have full coverage on the car both comprehensive and collision.
The purchase of car insurance can be tricky to navigate, and it will take up a significant amount of your time, but with careful planning, and an informed choice, you will surely make the best and cheapest decision for you and your vehicle.