Ultimate Guide to Cheap Car InsuranceIf you own a car, truck, or other vehicle you are required by law to carry some type of insurance coverage. At a minimum, you are required to carry liability coverage that will cover expenses related to personal injury or property damage. In other words, if you cause an accident and someone is injured or property is damaged, you are responsible for paying for damages.
An insurance policy guarantees payment of a certain amount to cover these expenses should an accident occur. The rates you pay for your car insurance policy are based upon many factors including: age, sex, driving history, credit history, and year, make and model of the vehicle being insured. Other cost factors are determined by the amount of coverage you want.
Comprehensive is the most expensive type of insurance coverage. This type of insurance can offer protection to you, your family, and your car. It covers other things that can happen to your car such as fire, vandalism, or acts of Mother Nature such as hail damage.
Liability is the cheapest car insurance; however, if you do not own your car outright, you cannot purchase liability insurance alone. Lenders require you to have comprehensive insurance covering the vehicle until the note is paid in full.
Liability insurance offers protection to people in other cars when you are at fault for an accident. Typically, liability insurance will cover medical expenses and car repairs, up to a certain dollar amount. In most cases, liability insurance covers you in any vehicle that you drive, whether it belongs to you or someone else.
It used to be that Americans had few choices when it came to car insurance. There were a few major players and they basically had the same rates. Today, there are hundreds of insurance companies eager to obtain your business. The best part is they are offering cheap car insurance rates.
The following tips can help you obtain the cheapest car insurance rates, while making certain you adhere to your state’s minimum insurance requirements.
1. Shop around.
Conduct research via the Internet or by phone. Nearly every car insurance agent will provide you with a free quote. It’s a good idea to shop around for competitive rates on your current vehicle. If you’re thinking of buying a new vehicle, obtain quotes for the car you are interested in purchasing. Nothing stings more than to buy a car, only to discover you now have a $400 a month insurance premium. Know your insurance costs before you buy a car, and plan your budget accordingly.
2. Keep a clean record.
Both your driving history and credit history are determining factors in the amount of your insurance premium. If you want to have cheap car insurance rates, keep your foot off the gas, obey traffic laws, and pay your bills in a timely fashion.
3. Bundle your insurance.
Many car insurance companies offer other types of insurance such as homeowner’s and life. If you buy all your insurance coverage from them, chances are you will receive a significant discount on your premiums.
4. Increase your deductible.
One of the biggest mistakes car owners make is to purchase a policy with a low deductible. By increasing your deductible to $1500, you can save up to 20 percent off your monthly premiums. A smart thing to do is to place $1500 in an interest-bearing savings account. The money can draw interest and you will have peace of mind knowing the deductible money is sitting in the bank should you ever need it.
5. Buy online.
You can save up to 10 percent or more by purchasing car insurance online. Many insurance companies offer a discount to individuals who set-up automatic payments. This can be done by entering a credit card number or bank account. Each month the agreed upon amount will automatically be deducted from your checking account or charged to your credit card.
6. Buy a more economical car.
Insurance rates are partially based on the type of car you drive. If the vehicle has low safety ratings, high theft rates, or high incidence of vandalism, you will pay a higher premium. It’s a good idea to research car ratings prior to purchasing one. Look for cars with high safety ratings and low maintenance costs.
Finding Cheap Car Insurance Online for Your Auto
Has the time rolled around again to renew your car insurance? Are you tired of paying high premiums for your car insurance? Are you a first-time care owner searching for cheap auto insurance? If you answered yes to either of these questions there are a few things you should know about finding cheap car insurance. The first suggestion is to shop around. Shop around town, shop in towns near you and shop on the Internet. Nowadays you have the liberty to shop in many different areas to find cheap auto insurance. If your current insurance company isn’t providing the service you’d like, you are free to move on and find one that is eager to meet your auto insurance needs. You may find cheap auto insurance right in the town where you live, if not, you can definitely find an insurance provider online capable of offering you an auto insurance plan suited to your lifestyle and financial situation.
One way to find cheap car insurance is to buy an older car. Because older cars do not have the same retail value as new cars, they are cheaper to repair or replace and so it’s easier to find cheap auto insurance. If you have a new or expensive car, there is not need to sell it and buy a less expensive and older one. If you are looking for a vehicle and hoping to find cheap car insurance, you might choose an older vehicle.
Finding the cheapest car insurance has much to do with the individual. If you have a bad driving record, you may as well forget finding cheap auto insurance. It is imperative if hoping to find cheap auto insurance, to keep your driving record as clean as possible and avoid tickets and fines.
If there are multiple drivers in your household and they each have a car, finding cheap auto insurance may require having all of the vehicles insured with one insurance company. Car insurance companies are normally happy to offer discounts in situations such as this.
Another step you could take in finding cheap car insurance is prove to the insurance provider that you are attempting to prevent events such as vandalism and theft. You can do this by installing anti-theft devices on your vehicle. Insurance companies see that you are making this effort and you will be eligible for cheaper car insurance. In the same way, installing safety features such as anti-lock brakes, airbags and automatic seat belts can be beneficial in finding cheap auto insurance.
Finding cheap auto insurance may require your willingness to agree to a higher deductible. It will require more out-of-pocket expense if you have an accident. However it will definitely save money on your car insurance premiums. Face it, you may drive all your life and never have an accident. Taking a risk by agreeing to a higher deductible may save you thousands of dollars and be your key to finding cheap auto insurance.
There are many avenues you can take when searching for cheap insurance. It’s essential however to make sure whichever insurance you buy provides adequate coverage. A cheap auto insurance plan is useless if it leaves you wide open for financial difficulties in the case of an accident. Finding cheap auto insurance is great but you do need certain coverage, depending on your car and your lifestyle. Take your time in searching. There are hundreds of online companies who are prepared to help you find the perfect auto insurance plan for you. Take time to compare the various rates, according to their coverage, from site to site. Take advantage of the convenience of online shopping.
Understanding Insurance Vernacular - Minimums, Liability, Comprehensive, and Full Coverage
“Earth, wind, air, and fire.” “Emceeing, DJing, breaking, and graff.” “Liability, medical payments, uninsured motorists, and damage to your auto.” Somehow the four elements of car insurance don’t have the same ring to them as the four elements of hip-hop. Then again, maybe people would learn more about car insurance if there were a show like “Wild & Out” for insurance agents. I can see it now: Two insurance men take the stage and “battle” to give the judge the best rates. Surely, the essential thing for any freestyle insurance champion would be to understand the four elements, as outlined below.
Part A - Liability Coverage
The first and most important car insurance coverage is liability. Liability coverage protects the “insured” against lawsuits from people and property injured by his or her actions. For example, if you ran a red light and hit an old lady in a Cadillac, your liability coverage would pay for the lady’s bodily injuries, as well as the property damage to her Caddy.
There are normally “split limits” to liability coverage. For example, you could have liability coverage with a bodily injury limit of $100,000 / $300,000; and a property damage limit of $50,000. The $100,000 of bodily injury refers to the maximum amount payable to each person, and the $300,000 is for each accident. The property damage limit is for each accident. So, if the old lady with the Cadlliac had three passengers, and she and each of the passengers suffered $150,000 worth of damages, your car insurance company would only pay for the first $100,000 on three of the victims. You would be responsible for all of the rest.
Part B - Medical Payments Coverage
While liability coverage deals with other people, medical payments coverage is for you. It involves an agreement by the insurance company to pay medical, surgical, ambulance, hospital, nursing, and funeral expenses, up to a specified limit. Also unlike liability coverage, medical payments coverage protects the insured and his or her family members without regard to fault.
Part C - Uninsured Motorists Coverage
This coverage insures against losses caused by uninsured or unidentified motorists. For example, if instead it was the old lady who ran the light in her Caddy and hit you, and come to find out, Grandma was uninsured and living on Social Security, uninsured motorists (UM) coverage would be necessary in order to collect damages from your own insurance. UM also protects you against the Halle Berrys of the world who cause an accident and flee the scene of the crime. If hit-and-run perps are never identified, who can you hold accountable? No one. Which is why UM coverage kicks in.
Part D - Coverage for Damage to Your Automobile
This is the coverage that protects you against damages sustained to your own car. It is split into two categories: Collision coverage, and other-than-collision coverage (also known as “OTC” or “comprehensive” coverage). Obviously, collision coverage insures against collisions (duh!). OTC covers loss due to fire, theft, explosion, earthquake, flood, vandalism, and animal accidents (which are literally “collisions,” but not in the world of insurance).
Epilogue - You’d Better Shop Around!
Far too many people fail to view car insurance as a financial product, and instead, view it simply as something that they have to have, by law. People with this view are essentially throwing their premium dollars out the window. Since you have to have car insurance, why not insist on the best value for your money? Not having enough coverage is one sin, but having too much (or the wrong kinds) is almost equally bad. The best thing you can do to ensure you’re getting value for your monthly premiums is to shop around, and with the internet, it has never been easier. Get informed on the ins-and-outs of car insurance terminology and decide on what types of coverages (and what limits) make sense for you. A small investment of time and energy can save you thousands of dollars over the course of a lifetime.
