If you consider property insurance a priority, then you might want to ensure your vehicle is covered too. Auto owner’s insurance or Car Insurance is one that saves you cost in case of a theft, or accident while using your vehicle. This includes liability, which is your responsibility should you harm others or destroy their property while using your car, as well as the cost of medical bills if needed.
Is auto insurance coverage mandatory?
Generally, auto-insurance is considered a legal document in most states of the U.S, except for New Hampshire where an alternative is proof of financial responsibility. The requirements per insurer and state however vary, so there’s a need to have your facts right before signing a policy.
Something else to influence your decision is that uninsured cars cost more to insure even if they were previously insured, as you’re thought to be more at risk than others who are insured. Hence you should renew when due, even if you might be going away on vacation, or bed-ridden for a while. All you need do is speak to your insurer to know if there’s a special coverage plan for you.
Why is my Car Insurance so high?
When buying a policy, things factored into calculating your premium are:
Factor 1: Age and marital status: younger drivers are thought to be more reckless, as well as the unmarried, even though this has been proven to be an unfair bias.
Factor 2: Location: cost in big cities are usually way more than in smaller cities, as the general cost of living is higher.
Factor 3: The car type and model: different parts of the vehicle determine overall how much it'd cost to replace or fix them should the need arise.
Factor 4: Occupation: the work you do determines how much damage you might expose your vehicle to.
Generally, the more risk you present, the higher your premium.
Looking for more information about Insurances? Find out how online reviews help you find the right insurance. Otherwise, feel free to read more about car insurances
How does Car Insurance work?
There are different types of car insurance offered by insurers such as Lemonade Insurance:
- Collision insurance:
this helps to repair or replace an insured car in the event of an accident involving another car.
- Comprehensive insurance:
this is a notch higher, and covers damage asides collisions, such as accidents involving animals, or caused by bad weather.
- Liability coverage
: this is legal in most places in the U.S, and covers damages caused by you to others, whether injuries to them or to their property.
- Uninsured motorist insurance:
this covers you in the event of a collision with an uninsured or hit-and-run driver. Usually, you buy this with an underinsured motorist insurance which covers you when involved with a driver who can't foot your bills.
- Gap insurance: due to depreciation,
you might be in a situation where your settlement might not cover your car loan. This insurance pays for the excess.
- Medical payments coverage:
this covers medical bills without regard for who caused the accident.
- Classic car insurance
: just like exotic pets have a special category, this covers for classic cars and their peculiar needs.
- Rental reimbursement insurance:
after an accident, there’s need to move around to several places in a bid to get care, this insurance will cover the cost of a rental car that will be tasked with moving you around.
Cheap Car Insurance
To get cheap car insurance, you could reduce the amount paid on premiums by taking 3 different steps:
1. Changing the policy you’re paying for if the need no longer matches, e.g. a vehicle which you rarely drive has zero need for a comprehensive policy.
2. You could go for a higher deductible which would reduce your monthly premium. Think about this carefully as the insurer can’t pay anything below this amount e.g. if you choose a $1000 deductible in a bid to pay lesser premiums, you wouldn't be entitled to any insurance coverages with bills of $1000 or less.
2. Buy multiple policies, or cover multiple cars from the same insurer, and you might be given some discounts. Some insurers also reward good driving behavior.
How to Switch Car Insurance
If you’re thinking of how to switch car insurance for whatever reason, then you must consider quotes from different companies, as well as review their policies for different coverages. When you’ve settled on one, you can go ahead to talk to the old company and you’ll be informed of penalties, if any.
One thing you must ask about are exclusions, and this must be explained in clear terms so you know what you are signing up for.
Generally, your car won’t be covered if it’s used for business. To fit this into your policy, speak to your insurer as nowadays, there are special plans to cover for those who rideshare drivers e.g. Uber.
As a rule of thumb, insurance follows the car. Hence, it wouldn’t matter who's driving should an issue arise. However, you might want to confirm this with a prospective insurer.