Car Insurance: Choosing the Right Policy
Choosing the right car insurance policy is every bit as important as choosing a new car- it can mean the difference between being covered and not being covered in the event of an accident. This guide will help you choose a policy that meets your needs and is within your budget.
First, you will need to decide whether you need comprehensive coverage or liability only. Most car dealers will require you to purchase comprehensive coverage if you are financing the vehicle. Full or comprehensive coverage means that your insurance company will pay for a wreck even if the other driver is uninsured. Liability insurance only pays the other person's damages when you are the at-fault driver.
Decide how much liability coverage you need; it determines how much your insurer will pay on your behalf and pay you if you are in a collision. If you are at fault and your insurance doesn't cover the loss, you can be held legally responsible. Every state in the US has a minimum amount of liability coverage which drivers are required by law to have. Your insurance policy's deductible is another important consideration. The deductible is the amount you have to pay out of pocket when you file a claim, and in most states it ranges from five hundred to two thousand dollars.
When you are choosing an insurance policy, you should never give up customer service for a cheap price. Find a company that is a combination of both! The price may be low, but if they put off processing a claim, you may regret your choices. At the time you are shopping for a policy, find out how long the company takes to process claims.
If your car is heavily modified or has a lot of extras, you will need to buy coverage for them. Standard car insurance policies don't cover extras like lighting kits and handicapped aids. For some drivers, these items are necessary, and they can cost thousands of dollars to replace.
When choosing a policy, you also need to think about buying medical or injury coverage. Most car insurance companies charge extra for this. If you are in an accident and need to be hospitalized, you'll wish you had this coverage. Most medical plans cover the other driver if you are at fault; costs can easily exceed $20,000 for a single accident.
Price is another thing you need to consider when choosing a policy. Like every other kind of business, each company has its own fee structure. The large number of insurance companies means that you can find one that fits both your car and your price range.