Car insurance isn’t something to think a lot about because it is mandatory. However, there are things to keep in mind before selecting the best car insurance policy to suit your budget and needs.
There is a fair choice of insurance providers in Montgomery County, PA. Many times, the fear of overpaying or getting less coverage can take over, adding to the confusion.
Today, we’ll help you clear up the biggest dilemmas so that you can proceed to invest in car insurance that serves you well.
Know how policy rates are decided
Every insurance firm has its own method to calculate the car insurance premium, but a few basic factors remain common among all. They consist of factors like the build and model of the vehicle, the usage, and the client’s driving record.
Other factors taken into consideration are:
- The client’s gender, age, and marital status: As per statistics, young drivers with less experience and men are more likely to get into an accident. People that are married have shown lower incidents of accidents, which is why their premiums are priced lower.
- Location: A client residing in an urban location with a substantial crime rate is considered to pose a bigger risk than someone living in a rural area with low crime rates as well as no traffic.
- Credit score: Insurance companies can consider a potential client’s credit scores when calculating the price of car insurance in Montgomery County, PA. Statistics show that drivers with a better credit rate are less prone to getting into accidents. However, consumer advocates are of the opinion that this mindset is capitalistic and hence unfair to lower-income groups.
Collision Versus Comprehensive Coverage Policy
When it comes to getting car insurance, it can be daunting to decide which one of the two is more appropriate. Many car owners don’t know the details of the insurance type they’re investing in.
Studies show that about 68 percent of Americans have the misconception of the comprehensive aspect of a policy that covers their car from collision damage.
To clarify any such misunderstandings:
- Comprehensive Policy: Gives policyholder insurance cover against damage and theft due to incidents apart from collisions. For example, flood, fire, vandalism, tumbling rocks, hail, falling trees, or striking a deer.
- Collision Policy: Covers a policyholder against damage due to collision with another vehicle or object when the policyholder is at fault. It also reimburses you for damage due to potholes or rolling the car.
Both the above-mentioned coverage options can be used as an add-on. However, liability insurance is legally mandatory since it reimburses the expenses related to injuries, damage, or death of a third-party driver or their vehicle while you were driving.
An Expensive Car May Not Have an Expensive Premium
This is the reason you should figure out the insurance premium cost for the options you’re considering purchasing.
Experts have noticed that an expensive vehicle shows a higher claim rate for theft, damage, and accidents.
This is why their premiums cost less than lower-priced cars.
Figure Out Ways To Save on Premium Charges
You may have many ways to lower the insurance charges. In a few instances, it could mean reducing your overall coverage. You can reduce your charges by using the following methods:
- Boosting the deductible to $500 from $200 will substantially lower the comprehensive and collision coverage charges by up to 15 -30%.
- Choosing a deductible of $1,000 can save 40% or more on your policy bill.
Insurance firms provide discounts if you have more than one car, low mileage, and safe drivers with no violations in the last three years. Students with good academic records are also subject to further discounts. Another way to get a better rate is to get your homeowner’s policy from the same firm.
Personal Cars For Business Purposes
Most car insurance policies don’t account for using personal cars for business. Many firms will terminate the policy if they find out.
Policyholders need to understand this aspect if they have taken up an alternative business such as ride-share, pizza delivery, or messenger. Ensure that you’re covered legally because if you get into an accident, you might be in trouble with a canceled policy.
Talk to the insurance firm about receiving an endorsement to the existing policy for such business drives. Uber and Lyft drivers using personal cars get fair coverage from the company itself if the accident occurs during their working hours while a customer is in the car.
However, you are not covered if there is no passenger while driving around or waiting for a request.
Third-Party Driving Your Car
The insurance company traces the car and not who drives it. If someone other than yourself has been driving the car, you’re letting them borrow not only the car but also the insurance in the majority of the cases.
Don’t worry about letting your friend or a colleague drive you if you have had alcohol; they are covered, and it is better than getting into a drunk driving accident.
Don’t Let the Insurance Lapse
Some of you might consider canceling the insurance when you’re not using it for an extended time. Sometimes, you may forget to renew the premium. However, if you let the premium cover lapse, the insurance rates will skyrocket if you want to purchase a policy again.
Also, if your car gets vandalized or damaged during such a time, you will not be covered.
In case you plan to keep your car indoors and won’t be using it for a long time, make sure that you call your insurance company to discuss your options in this aspect. They will probably come up with a better offer than letting the policy lapse.
Purchasing car insurance is similar to shopping for any other investment. You will have to compare multiple alternatives and talk to others for consultation before zeroing down on one.
Make sure that you consider these pointers to always stay on the safe side; we hope that our clarifications helped you ease some of the confusion of buying car insurance!