Car insurance is a necessary part of owning a car. It’s required by law that every vehicle on the road is insured, in the event of an accident. Car insurance can also insure against many other risks. It’s important to understand what each insurance company is offering you. The cheapest insurance may not always be the best.
The main purpose of car insurance is to protect the driver against liability. If you should ever be the cause of an accident, the other driver could potentially sue you for loss or damage. This is how it protects you—your insurance company will work with them to find a settlement that is fair. It’s a lot better than losing your car, house, or other assets, particularly if the other person was seriously injured and unable to work for any length of time.
The second purpose is to protect your vehicle against loss or damage. It can be more affordable paying a monthly rate than actual repairs, should your car be damaged. It can also pay your medical bills regardless of whose fault it was.
There are also those unexpected, and unfair incidents in life that can cause loss. You may find you’re the victim of a hit and run. While upsetting, you’ll feel confident if you have the right insurance plan in place. Cars can also be stolen, so it’s always a comfort to know you’ll receive exact replacement value.
Some types of cars cost more than others. It makes sense that classic and sports cars cost more. If they are your second vehicle, you can save money by insuraning them for personal or leisure use. This means that you will not be driving them to work each day, and you’ll only be driving them on roads, and not freeways.
But what do you do when regular cars cost more than others? Apparently each vehicle is assigned a code, and that translates to how much it’s going to cost to insure. A vehicle that is older will always cost more, as it’s not brand new anymore. Some vehicles such as foreign cars may cost more to fix, as parts are harder to source, and may need to be ordered. These are reasons why some cars may cost more to insure.
If your insurance year is up, you should shop around for a better rate. Often insurance rates will increase for no reason at all, except that it’s a new year. This is a practice that is done with house and condo insurance too. It can be of benefit to you to cancel your current insurance and start over with a new insurance company.
Letting your current insurance provider know of this intention may also have them scrambling to provide you with a better rate. Either way, you win. Another good tip is to ask friends, family and coworkers if they’re happy with their car insurance rates, and if so, who is their provider?
Don’t settle for a high car insurance rate. Shop around until you are satisfied that you’re getting full coverage for a fair cost.