Do You Have The Right Car Insurance Coverage?

by Hank Coleman

Do you have too much automobile insurance? Do you have too little insurance coverage? Every state in the United States has requirements that each driver must adhere to with respect to how much liability and personal injury coverage you have to have in order to protect yourself as a driver. Car insurance can be a relatively high cost associated with car ownership, but there are a few ways that you can help protect yourself and still save a few dollars at the end of the day as well.

Reduce Your Mileage. One way you can reduce the amount that you pay for your auto insurance is to reduce the amount of time you spend driving in your car. Have you ever wondered why the car insurance salesman asks you how much you drive each year or drive back and forth to work? Because there is a direct correlation between the amount of miles you drive and the number of accidents you get into. Keeping your mileage low can help you lower the cost of your insurance premium. I am not saying lie by any stretch of the imagination. Do not confuse my comments in that respect, but you should also be accurate with your answers. Do you rarely use your car because you started a carpool at work? These are the types of things that your insurer needs to know and have updated with them in order to receive the best rate.

Parking Your Vehicle. Keep your car away from thefts. More than half of car thefts happen after dark, so the more you can keep your car safe from any kind of thievery, the lower your premium may go. If you do not have access to a garage, then parking in a driveway versus on the road still lowers the chance that your car will be stolen or vandalized.

Comparison Shop. Compare your current insurance costs with other insurers on an annual basis. There are many good websites out there that will let you compare several insurance companies and policies at one time. Shopping around will enable you to make sure that you are getting the very best rate possible. Just remember to compare apples to apples with respect to policies and terms.  

Salient Questions. You want to make certain that you are paying for coverage you can use and only the coverage that you need. Therefore, answer the following questions to make sure that you are making full use of your insurance coverage.

  • Does your current policy include roadside protection in the price?
  • What are the deductibles? Can you afford a higher deductible?
  • Do you have personal injury protection (PIP) coverage? If not, and you can afford it, you should consider it as it will pay your medical costs regardless who is at fault in an accident. Many states make this protection mandatory. If you live in a state where you are not required to carry it, you may want to think about purchasing it.
  • If you drive an older car, do you really need collision insurance? Do you have enough in savings to cover the cost of, say, an older model car?
  • How about comprehensive insurance? If you have an older vehicle, you may be wasting your money by paying premiums on this kind of protection.
  • Do you need to increase your compulsory coverage of bodily injury insurance? A lot of people do, and they do not even realize it. It will do you little good if you carry many states’ minimum coverage of $20,000 and hit a newer vehicle that is valued at $40,000 or more.
  • How about uninsured motorist’s coverage or underinsured motorist’s coverage? If you can afford this protection, it may definitely be a good idea to take it.
  • What kind of discounts are offered for good driving, good grades, other policies from the same insurer, etc.? There are a ton of discounts out there. You just need to know how and what to ask for.
  • Does the insurer provide concessions for security alarms?

Make a checklist of what you need with respect to coverage. Know what types of insurance and coverage you are getting for the price you pay. Millions of auto accidents occur in the United States each year. Therefore, it is important to be well-covered to reduce your risk. Take time to investigate the various types of protection and obtain quotes online. You can still increase your savings while making sure that you are receiving the optimum benefits for your situation.

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{ 1 comment… read it below or add one }

AARP June 29, 2010 at 2:41 am

Check if your workplace or association has a tie-up with any insurance company. That can get you a good deal. One example is The Hartford and AARP tie-up for home and car insurance that gives special rates to members.

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