Auto insurance is a necessity, and it protects you from financial burden if you’re ever in an accident by yourself or with another vehicle. As you start to shop for car insurance quotes, it helps if you know what types of insurance are out there so you know what to ask about. There are some questions to ask yourself, too, as you decide what you need.
What Is Liability Insurance?
For example, do you only want to be responsible for paying for repairs to someone else’s car and medical bills if you caused the accident? The short answer is you might not have a choice in this because this is the minimum liability coverage required by most states. Amounts can change per state, so you’ll have to see what your location requires. You might want to consider buying additional liability coverage in case you’re ever in an accident where the minimum amount wouldn’t be enough.
Do You Need Collision or Comprehensive Coverage?
Then you have collision coverage. This type of coverage pays to replace your car if you’re in an accident. You may or may not need this coverage; it depends on what your vehicle is worth. If it’s on the pricier side, you’re going to want to have collision coverage. If it’s a cheaper car worth less than a deductible, you might as well skip this type of coverage.
Comprehensive coverage becomes an option if you want to make sure your car is covered by flooding, fire, or other damages caused by anything except for collisions. This optional type of coverage is only necessary if your vehicle is worth it or if purchasing a replacement would put you in financial distress.
What About Medical or Uninsured Coverage?
Medical and personal injury protection coverages are similar. Medical coverage pays for you and your passengers’ medical bills. Personal injury protection coverage covers medical expenses and other issues, like wages that you’ve lost due to an accident. While not required, this is always recommended if you’re involved in an accident and can’t work for a time afterward as you’re recovering.
The one thing you want to make sure you have in addition to liability coverage is uninsured or underinsured motorist coverage. Sometimes, people don’t have insurance, and when they don’t, you’re responsible for paying your bills yourself. You can also use this coverage if you’re ever involved in a hit-and-run situation and don’t know who caused the damage.
What Kind of Perks Exist?
Extra perks also exist in insurance coverage if you want them. These perks include towing your car for a certain distance or paying to have someone come out to you for assistance if you have a flat or a dead battery.
Another perk is rental reimbursement if you require a rental after an accident. If your car is in the shop for repairs after a crash, you’ll need another vehicle, so your insurance company will cover that if you have this option on your policy.
How Much Does Auto Insurance Cost?
The cost of auto insurance varies between companies and is based on various factors. To get quotes for how much you can expect to pay, you’ll need your car’s make, model, mileage, and VIN. You’ll also need to give the company your social security number so they can run your credit. Higher credit scores result in lower premiums, so if you can improve your credit score, you should.
Liability insurance is the cheapest to have, but it may be better for you and your car to have more coverage to include comprehensive and collision coverage. Getting auto insurance without paying too much is relative to your vehicle, credit, and driving history. A cleaner history gets you better premiums, as does an older car that is less to insure. A newer car that has all the bells and whistles is going to cost more.
To help you lower your costs, you can ask about discounts that are available at each company. If you have more than one vehicle to cover, you can qualify for a multi-car discount. Students with good grades can be eligible for discounts, and some companies also offer discounts based on driving habits. They install a little box that keeps track of how you drive, and it’s reflected in your premiums.
Don’t Pay More Than You Need To
Insurance salespeople want to sell you as much insurance coverage as possible, but the reality is that you won’t need everything they offer you. You need to understand your circumstances to know what type of coverage is best for you. Once you know what you want and what you need, you’ll be better able to request quotes to see what you can expect to pay for insurance premiums.