Part of good personal finance is making sure that you are properly covered by insurance. And, of course, your auto insurance premiums will be part of your monthly financial planning. Looking for a good auto insurance deal can be troublesome, but it should be done. Shopping around for a good car insurance deal can help you save money, and it ensures that you are financially covered in case of an accident.
What insurance coverage you should have
It is important to make sure that you have insurance coverage adequate to your needs. If you still have a lien on your car, you will probably have to make sure that you have comprehensive coverage. If your car still has some value, even if you are not making loan payments on the car, it is a good idea to get comprehensive coverage so that you can get the value of your car back if it is totaled. In any case, you should make sure to have liability coverage, so that if you cause damage to someone else’s car or person your insurance company will cover it and costs of any litigation that may arrive. Besides, in most states, the law requires you to carry liability coverage. Other forms of coverage, including towing, car rental and winshield repair and replacement, should be purchased according to your own needs.
Car insurance premiums
The auto insurance premium is what you pay for coverage. Insurance companies usually invest it to help them earn money to cover claims. Your premium is based on your driving record, how safe your car is, the area in which you live and your credit score. Additionally, your deductible, the amount of money you agree to pay before the insurance company kicks in to pay covered expenses. If you have a higher deductible, meaning you agree to pay more of the expenses incurred regarding your car, then your premium will be lower. Most insurance companies figure premiums on a six-month basis, but will divide it out so that you pay monthly if you do not wish to make such large payments twice a year. Many insurance companies offer a modest discount if you agree to have the insurance premium taken directly out of your bank account, and you will always get a discount if you purchase other products from the insurance company, or insure multiple vehicles.
Auto insurance tip
One interesting car insurance deal I found is through American National. This company has a program in which you are refunded 25% of your premium payments at the end of three years if you manage to avoid making any claims or getting any traffic tickets in that time. This is an interesting program that is worth looking into if it is available in your state.