Choosing an auto insurance policy isn’t always as straightforward as you think. You could overpay for coverage if you’re not careful, or worse, not have all the coverage you need. These three tips will help you choose the policy that’s right for you.
1. Know Your Coverage Options
Deciding whether or not you need comprehensive and collision coverage is one of the first things you need to do as well as one of the greatest cost indicators. If you have a loan on your car, your lender will most likely require this coverage.
Comprehensive coverage protects you from incidents like theft and vandalism as well as floods and other natural disasters. Collision coverage protects you in the event of an accident, whether it’s your fault or not. It can also come in handy if someone is at fault for a collision with your vehicle but doesn’t have insurance, or has such low limits that their policy won’t cover damage to your vehicle.
2. Do the Math
Whether or not you need comprehensive and collision coverage depends on the value of your vehicle. For most older vehicles, it simply isn’t worth it to pay for this coverage. If you pay $100 a month for comprehensive and collision coverage, the amount you pay over the course of a few years can exceed your vehicle’s value when combined with the deductible.
If comprehensive and collision coverages are right for your vehicle, choosing the right deductible is also important. It may not make sense to pay an extra $50 a month for a deductible that saves you just $500 if you do end up making a claim.
3. Review Add-Ons
When choosing a policy, you’ll also want to find out what riders are available. A rider is an add-on provision to your insurance policy with additional benefits. Riders can be useful if you have an expensive car stereo in your vehicle, for example, or extensive aftermarket parts.
Another rider that’s important to some customers concerns the use of original equipment manufacturer (OEM) parts as opposed to aftermarket alternatives or parts from scrapped vehicles. If original factory parts are important to you, your agent can add a rider that guarantees damaged parts will only be replaced with OEM ones.
The best way to ensure your coverage matches your needs is to speak with a knowledgeable agent. Request a quote to get started.
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