Auto Insurance: Common Mistakes When Shopping for a Policy
Mistakes can be costly in life, and it’s no different when considering an auto insurance policy. When you have the wrong insurance, you will pay more than you should. The extra cost will be seen in either the monthly premium or when you go to file a claim. It’s important to research your options well and read all the fine print. Here are five mistakes to avoid before settling on your vehicle insurance.
1- Not asking for discounts
If you do not ask for discounts that could be available, you could be missing out on one that fits your situation. Remember to ask about discounts such as:
- Safe Driver: Driving safely is a popular way to earn lower premiums for many policies.
- Pay in Full: You often save on service fees if your total premiums if you pay annually.
- Organization Affiliation: If you’re a member of any organizations, there may be an affiliate discount available.
- Bundling Policies: You may also be able to bundle policies such as homeowner and auto to get a better deal.
2- Only getting the minimum required
While saving a little here and there is certainly important, it is also wise to invest in insurance coverage that can handle life’s potential mishaps. Skimping on coverage can hurt your wallet in the long run.
For example, some states only require minimum coverage, such as liability. If you cause an accident, liability insurance will cover the repair costs of the other driver’s vehicle. However, liability only will not pay for injury to you or repairs to your vehicle. You will need to pay those costs out of pocket. You can save future expenses by having additional coverage.
You probably don’t want to dip into a nest egg or vacation fund to pay for the repairs needed on your own vehicle. That’s where collision insurance can help. It can even help with replacement costs if you total the vehicle. If you collide with an object that is not another vehicle, like a light pole or a tree, it can also cover those damages.
Comprehensive coverage can cover those random but costly incidents:
- hitting a deer or other large animal
- vehicle fire
- theft or vandalism
- windstorm breaking a branch that falls on your vehicle
3- Going with the same thing you’ve used for years
It’s not uncommon to purchase what is most familiar, especially if it’s served you well over time. However, as time goes on needs change. It is wise to shop around if you have had any of the following happen:
- Purchase a new car
- Move to a new city or state
- Job situation change
Read your policy each renewal to make sure it’s still meeting your needs. Also, stay up-to-date on current state vehicle insurance requirements. Since some drivers choose to go uninsured, some states now require coverage for accidents with uninsured motorists.
4- Avoiding riders and other extras
It may seem that additional coverage automatically increases costs. Sometimes that is the case but customizing your coverage with riders can help save future money by spending a little more now. One handy rider to ask about and consider is for accident forgiveness. It will prevent the premium from going up if you get into an accident (usually only if it is the first accident you’ve had). Rental coverage can come in handy as well if your car is in the shop for repairs due to an accident.
Gap coverage can help as well, especially if you recently purchased a new vehicle. New vehicles depreciate a great deal the second you leave the car sales lot, a vehicle crash in the year after purchase could really set you back. Gap insurance will cover the difference between the assessed value of the vehicle and the actual cost you paid.
5- Skimming through your policy
It’s critical to read your policy well and be sure you know what is truly covered. Learn the differences between the vehicle insurance types and riders and know what you have. Don’t make any assumptions about what will and will not be covered. Ask questions about the terms that are not clear to you. A little diligence and attention to the details upfront can go a long way.
The more aware you are of your auto insurance options, the more money you can save on your auto insurance policy. Educate yourself before you look for your next policy, don’t settle for what you have always had, and if there are any questions, contact an expert like those with Demont Insurance.
To learn more about the best options for your auto insurance policy, contact the professionals at Demontinsurance.com at (850) 942-7760. Our licensed insurance experts will be happy to answer any questions you have.