The Internet has made it a lot easier to buy car insurance. You can compare rates from different companies in just a matter of minutes and make your choice accordingly. But finding the right policy is a lot more difficult than simply requesting car insurance quotes.
There are a ton of terms that can lead to potential confusion when searching for the best car insurance policy. That is why you should know a few helpful things before you start looking for another policy.
1. Know the Difference Between Comprehensive and Collision Coverage
Knowing the difference between the two is important in your search. Collision will reimburse you for damages to your car that come from a collision with either another vehicle or an object when you are the one at fault. It can also cover damage from rolling your car or potholes.
Comprehensive coverage is protection from just about everything else. That means theft, first and foremost. But it also means protection from damage caused by anything other than a collision, such as vandalism, flood, hail, fire, hitting a deer, or falling trees and rocks.
2. Know How Prices Are Determined
There are some basic factors that come into play when determining car insurance quotes. That said, most organizations will use their own formulations to determine what to charge for their car insurance. There are generally three factors overall.
Where you live matters. Living in a high-traffic area can mean a greater potential for theft and accidents. Your credit score plays a role because generally, those with better credit scores have fewer accidents. And your gender, age, and marital status matter, too. Young drivers (and male drivers) are typically more accident prone, for instance.
3. You Can Pay Less
It is thought that the only way to pay less on car insurance is to simply cut out some of your coverage options. And while that is true, it is not in the way that you necessarily would have considered. Dropping an old vehicle is a good start. Raising deductibles can too, provided that you can burden the larger out-of-pocket costs.
Some companies also offer discounts for multiple cars, low-mileage, and safe drivers. There are a variety of ways to save some money without having to undercut the coverage that your policy provides.
4. Expensive Vehicles May Not Be So Expensive to Insure
There is a generally used rule of thumb that the more expensive the vehicle, the more expensive it is to insure it. That is why it is so important to do all of the prior research into your vehicle and what the potential costs will be.
For instance, a high-end SUV may seem as if it would cost more to insure. The fact is that SUVs may have a better claim rate when it comes to accidents or thefts. It helps to talk to
your potential provider to see what ways there may be to save and cut down on the premium.
5. Who Else Does Your Insurance Cover?
There is another general rule when it comes to auto insurance. This is that the policy will follow the car, not the driver. So, if you loan your car to someone and they get in an accident with it, the procedure will follow the same chain as if you were behind the wheel.
That can be a huge peace of mind for those who share a vehicle. It is never ideal for the car to be in an accident but knowing that you can lend your car to those you care about is important, too.
6. Personal Insurance Doesn’t Cover Business Needs
Perhaps the greatest misconception when it comes to insurance is that you can use your own personal insurance when driving for professional reasons. Having a side gig, such as being a delivery driver or participating in a ride-sharing app, can drastically change how your insurance is structured.
There are inherently more risks when performing these jobs than there are when you are simply on your free time. In accordance, that means a higher risk of having to pay exponentially more when filing a claim. Know the difference and know which one works best for you.