Auto insurance is something everyone has to face at some point in life. Whether you are a beginner or you have had several experiences as an insured car owner it is always important to know important aspects about car insurance. This will help you avoid making mistakes that may result in penalties and at the same time understand what will help you get lower rates for your premiums.
To start you off, here are five key things you need to know about auto insurance.
1. Insurance companies use several aspects to calculate your insurance cost.
Some of the things that determine your insurance rates include the make of your car, your location, the use of your car, your against, driving record, accident and claims history among others. Your car model affects your insurance cost in two main ways. First, if it is an expensive model then you will have to pay more for the insurance company to cover the cost in case of an accident. Secondly, should be a model prone to accidents and lacking in safety features you will also pay more for the increased risk.
Young drivers, especially under the age of 25, carry a higher risk so they will have a high insurance cost. If your car is used frequently especially for business purposes it is also more likely to be in an accident compared to a car that is used over weekends only. If you are looking to cover your car against theft consider adding a few security extras to reduce the risk of it being stolen.
2. Consider the different insurance policies available and pick the one that offers the most value to what you can afford
By law, you are required to have a minimum of third party liability cover. This is for the sake of other road users and leaves you and your car without any cover. It is not wise to stop here. Instead, consider the getting yourself more coverage for potential risks. It is usually advisable to take a comprehensive cover and then add a cover for a specific risk you are likely to suffer from.
3. Compare different rates and take advantage of discounts offered
There are many auto insurance companies and many of them have their rates and calculators online. You do not have to limit your choices to those your family and friends use though that is a good place to start at. There are several online calculators and comparison sites that will help you determine the best rates. Besides that consider the discount options given to people with great driving records, anti-theft devices, paying in full and safety features among others. They go along way in reducing your cost.
4. Do not lapse on your car insurance
Make sure you make arrangements to ensure you are never late on your insurance payments. It is not only illegal and risky, it also can affect your insurance rates. Even when you have to switch from one provider to another, get the new cover while the old is still on to avoid the lapse and maintain your good standing.
5. Be careful with your deductibles
Deductibles are basically the portion of the damage you agree to meet out of your own pocket. The higher the deductibles you have the lower the insurance premiums you have to pay. However, make sure all your deductibles are expenses you can comfortably meet from your pocket should the situation arise to avoid being stuck.