August 24, 2011 ? Carol Fromme
With one car bumping into another, slamming into another, tumbliing off the road, or hitting someone or something approximately every 18 seconds in the United States, nearly all states require vehicle owners to carry auto insurance. It invariably adds quite a lump to the expense of owning a car, truck or motorcycle. Some auto insurance plans are more expensive than others. You can save money, often quite a bit of money.
Before you buy auto insurance, it?s wise to do your homework.
Liability Auto Insurance
Liability is the basic insurance that states require. It covers you in case you injure someone or damage property, including someone else?s car, but it does not cover damage to your car.
Generally, people who opt to buy only the required liability insurance have a car that?s paid for and that may be worth less than the cost of repair. In other words, by the time a car no longer has a debt on it, there?s no need to worry about repaying the lender for a car that was totaled. And also, sometimes the car may be worth less than the annual premiums on more expensive comprehensive auto insurance, so an owner may decide to skip comprehensive in favor of less expensive liability. In this case, if the car is involved in an accident, either the owner gets rid of it or has it repaired out of pocket.
The danger for the automobile owner who carries only the minimum required liability is not just that he may find himself without a car after an accident, but that he may be sued for more than the liability insurance will cover. If you have assets such as a home or a nice retirement account, they are at risk in this case.
Even if you want only liability, it?s smart to get enough liability to fully cover your assets in case you?re literally sued for everything you?re worth ? and it does happen.
Comprehensive Auto Insurance
Lenders who give automobile loans usually require the borrower to carry comprehensive auto insurance until the car is paid for and they no longer have a lien against it. And most auto owners want comprehensive insurance at this point ? the cost of repairing a new or fairly new car is very expensive. In the event of an accident, they know they won?t be able to repay the bank plus pay for repairs.
Comprehensive auto insurance also often comes with other benefits ? most comprehensive policies, for example, will cover car rentals, so you don?t need to buy the insurance at the car rental kiosk. And along with collision coverage, comprehensive insurance also covers your auto if it?s damaged in an earthquake, fire or other event. Some auto insurance companies, such as 21st Century Insurance, part of the 82-year-old Farmer?s Insurance Group of Companies, even offer 24/7 roadside service.
What Affects Costs
If you treat the highway as if it?s a NASCAR track, chances are you?re going to get pulled over. Maybe a lot. And that means tickets. But no matter how expensive they may be, the tickets by themselves are nothing compared to the way your auto insurance may sky rocket, particularly if you are a young male.
Speeding tickets are proof that you are reckless and careless and that you are more likely to be involved in an accident. So face it: any insurance company is going to make you pay a high premium in exchange for covering your reckless butt. If you want to hold your auto insurance costs down, maintain a good driving record.
The automobile you drive will also dictate insurance expenses. Some cars are more likely to be stolen, and insurance companies charge premiums that reflect that. Before you shop for a new car, give your agent a call and ask what makes and models you should avoid to keep a lid on insurance expenses. Also ask what features, such as an automatic braking system (ABS), will lower your auto insurance costs.
Many auto insurance companies, including 21st Century Insurance, also offer discounts if you also insure your home with them, if you?re on the Dean?s list, if you?ve completed a defensive driving course or numerous other things. Ask about them, and shop around.
There are good deals on auto insurance ? 21st Century Insurance says that drivers who buy auto insurance with them save, on average, more than $300.
So to save money on auto insurance, keep a lid on speeding, drive safely, inquire about special deals, and with the help of an agent, weigh your insurance needs against insurance requirements.
This entry was posted on Thursday, August 25th, 2011 at 12:07 am and is filed under Uncategorized.
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