Looking for best auto insurance? You have hit the right place. In this article, you will understand auto insurance essential, factors which make right auto insurance, and how to lower your insurance cost.
What is auto insurance?
In many states of the United States, it is mandatory to have auto insurance. This policy provides you some financial protection in case of an accident. It is a contract between you and your insurance company that offers you financial protection for loss in the event of a crash, theft. The company will pay for your damages mentioned in your policy, while you need to pay the monthly or annual premium.
What is Auto Insurance Coverage?
In case you are involved in a car accident, and you prove at fault, then the insurance company will pay your liability for bodily injury or property damage. Even the company will cover medical expenses for injury treatment and rehabilitation. You can customize your coverage amount according to your budget and needs.
Who will be covered by your auto Insurance Policy?
When you have this policy, then it will offer coverage to you, your family when they are driving your car. Even when they drive another person’s car with their permission, then coverage will be available. This policy will also offer coverage to a person who is driving your car with your consent, and even though he is not a part of your plan.
What is not included in Auto Insurance coverage?
When you are using your car for commercial purposes like using it to deliver pizza for a company, then best auto insurance company won’t offer you any coverage. There is no coverage for share-riding services. However, if you are looking for this kind of cove coverage, then you can get an additional insurance product from your company.
Why do you need an Auto Insurance Coverage?
It is a mandatory requirement in many states to get financial coverage for your auto. When you are financing a car, then your lender requires you to get a personal auto insurance policy. Usually, every state requires a car owner to have a plan which offers coverage for bodily injury liability and property damage liability.
Bodily injury liability:
When you or some other person driving the car caused some injuries or death, the insurance company will pay your liability cost.
Property damage liability:
In case you cause any damage to another car or property, then your company will pay the cost of this liability on your behalf. Other states might require you to get PIP ( Personal Injury Protection), Uninsured motorist coverage.
In some states, it is mandatory to add such options in your plan while others might not require you to get this. However, when you have both options in your policy, you would be able to get additional financial protection.
it is mandatory to add such options in your plan while others might not require you to get this. However, when you have both options in your policy, you would be able to get additional financial protection.
Personal injury protection (PIP):
When you or your driver gets injured during an accident, then medical expenses will be covered by the insurance company. This policy also offers lost wages coverage.
Uninsured Motorist Coverage:
Sometimes, you are a victim of a hit-and-run accident, or you might get injured by a person who doesn’t have any best auto insurance. In such a case, you will get financial protection through this kind of coverage.
Under-Insured Motorist Coverage:
It happens many times that your car gets damaged or you get injured in an accident while another driver hasn’t sufficient coverage. He won’t be able to meet the cost of this accident. In such a scenario, this coverage comes to save you.
Must Get Coverage for Your Own Car
In a basic auto insurance policy, coverage is for another person, his car and property. Your vehicle won’t get coverage if it gets damaged. So, it is essential for you to create a financially safe net for your car. Here are some coverage plans you need to add in your auto insurance policy.
- Collision Coverage: When your car gets damaged due to a collision with another car or object, and you are at fault, then you will be reimbursed. However, this coverage won’t refund you when damaged is due to mechanical failure or usual wear-and-tear case.
- Comprehensive coverage: When damage to your car is caused by accident such as fire, flood, hail, falling rocks, trees, and vandalism, then you will get this coverage.
- Glass Coverage: It will cover the cost of windshield damage. Some companies offer no-deductible glass coverage that would include side windows, rear windows, and a glass sunroof.
Understand Gap Insurance
Whenever you have a claim, your insurance company will pay you the market value of your car. With the passage of time, a car depreciates quickly. So, when the market value of your vehicle is less than what you need to cover damage and expenses, then you have to purchase gap insurance to cover this difference. When you have a leased vehicle, gap insurance would be a part of your lease payment plan.
What Factors Makes The Best Auto Insurance?
Now you have understood, auto insurance and its coverage. The next thing is to understand what makes your policy the best one.
- The best auto insurance is one which offers you the most coverage for the best price.
- You get the best customer service. Whenever the need arises, someone must have your back.
- When you buy a policy from an insurance company that has financial stability, that’s mean you don’t have to wait for getting your claim payments.
- Your claim must be processed quickly and efficiently.
- You get a personalized car insurance policy. You can add some coverage based on your budget, needs, and requirements.
How is the cost of auto insurance determined?
You might be wondering about the cost of your insurance or premium. There are certain factors which are taken into account while determining the insurance cost. These factors include applicant age, his residential area, type of car he owns, his occupation, where he keeps his car, his credit history, for what purpose he uses his vehicle, and whether he is involved in any motoring offenses or not.
Young people often have to face high premiums because they carry greater accident risk than old and experienced people.
Many times, you heard of cheap and best auto insurance policies. But you must be aware of ghost brokers or fake insurance companies who sell fake insurance. They offer very competitive deals while their only motive is to run away with your money. Whenever you buy auto insurance, make sure that your insurer is regulated by the Financial Conduct Authority.
What is No-Claims Bonus?
If you don’t make a claim of your car insurance for a few years like three years then you can expect a non-claim bonus from the insurance company. You will get a discount at policy renewal from the company. Your bonus will remain intact even when you involved in an accident when you are not at fault. Whenever you required in an accident, it is your duty to inform your insurer as soon as possible. Even when you don’t make a claim, your insurance company would evaluate the situation.
How to lower your Auto Insurance cost?
Many customers ask whether they can negotiate the price of an insurance policy or not. Fact is that an insurance company is regulated by state and you can’t negotiate its pricing. However, there are specific ways with which you can lower your auto insurance cost. Let’s find out what these are.
Compare multiple quotes:
Don’t buy a policy from the first company you go to. You need to get quotes from more than three companies and then to compare their pricing, coverage, and cost option. For getting these quotes, you can check online websites of companies or make a call to their customer service department. If you are going to get a policy from the primary insurance company of a state, then it is suggested to check the state insurance department. Typically, they offer a price comparative analysis for customer help and reference.
Price is not the only factor to decide about a company’s auto insurance policy. You also have to check the financial background of a company from whom you are purchasing a policy. For checking the financial health of an insurance company, you can visit A.M.Best and Standards & Poor’s and check your selected company’s commercial rating.
Make sure you ask all relevant and important question from an agent of an insurance company. An agent will help you understand what you will get and what is not part of your plan. If you want to save your time and energy, the best thing to do is to ask your friends, colleagues, and family members for their recommendations.
Compare insurance cost:
You will have to pay a premium for getting coverage from an insurance company. Before you buy an auto insurance policy, you should compare insurance cost. Your car premium amount is based on your car’s price, its repair cost, its safety record, and theft cost. In case you have some features which would prevent theft and injuries, you can reduce your premium or insurance cost quickly.
Opt for High Deductibles:
You can lower your insurance cost quickly by agreeing to pay high deductibles. It means that you will save some money by yourself, and this saved money will be paid when your insurance claim kicks in. For example, if the repair cost is $1000 and you are agreed to pay $500, then the insurance company will only pay $500, and thus you can get a low-cost insurance policy.
Drop Coverage for Old Cars:
When the market value of your car is five to six times less than the premium, then you should consider reducing your coverage. You need to get an idea about the market value of your car. For this purpose, you can contact the bank or auto dealer. If your vehicle is old, then you should think of only a basic policy which would be low cost.
Get a Bundle Insurance:
Many people pick different companies for their home and best auto insurance needs. It is the wrong approach. If you want to lower your insurance cost, then you should get both homeowner insurance and auto insurance from the same insurance company. Even when you have more than one vehicle, you can reduce insurance cost by getting multiple car insurance from the same provider.
Maintain Good Credit Record:
When an insurance company prices your insurance policy, it will take into account your credit record. People who maintain a proper record can quickly get a reasonable and low price. On the other hand, when they have little or poor credit record than the cost of their insurance policy rise.
Get Low Mileage Discounts:
Many insurance companies offer a low mileage discount. When you drive a lower than the average number of miles per year, you can easily reduce the cost of your insurance policy.
Consider Group auto insurance:
An employee can ask the employer about the group car insurance policy. When all employees of a company get protection from the same company, then it ultimately the lower cost of insurance for the individual employee. Some business, alumni groups, and associations bring group best auto insurance facilities to their members. Other ways to Get Auto Insurance Discount.
If you don’t do any moving violations and don’t get involved in an accident for years, then you can get a discount from your insurance company on policy renewal. When you take a defensive driving course or Drivers Ed course, you can seek a discount. When you install anti-theft devices, they will drop down the risk of theft. Thus you can lower the insurance cost.
Best Auto Insurance: Monthly vs. Annual Premium
When it comes to paying the premium for an auto insurance policy, then you have two options available. One is the annual premium, and the second is a monthly premium. Many customers ask which option is the best for them.
In case of an annual car insurance payment, you will pay upfront for a policy. There is just one single payment you have to do. Every policyholder can’t pay upfront for a year in one go. The main advantage of the annual premium is that you can get access to deals from the company and you can get cheap insurance.
On the other hand, monthly premium payment seems like the most affordable and convenient option. But the major downside of this option is that you won’t get cheap price policy. As you are dividing your premium in 12 months, then each premium payment also includes interest. Your insurance payment might become manageable in a monthly payment plan, but the cost of your insurance increase up to 20 percent in comparison to the annual payment plan. There are many insurance companies which don’t offer a monthly payment plan. So, if you opt for this option, you might miss great deals from the best company.
When you are going for a monthly payment plan, the insurance company is giving you a loan for the sum of your insurance. Therefore, the company will check your credit history. People with good credit can enjoy a reasonable monthly payment plan. However, people with bad credit history can expect an expensive monthly premium plan.
Annual Vs.Monthly payment: Which is the best option?
Without any doubt, an annual insurance payment plan is the right choice to make. It might not be affordable, but it let you avail the best deals at the best price. So, when you are looking for the best auto insurance, you should opt for an annual premium. It is suggested to save some money every month and then premium in one go. Monthly premium sounds like a very convenient idea, but in the long run, this plan would do nothing but to increase your overall insurance cost. Therefore, you shouldn’t go for this option unless you have no other choice to make.
The best auto insurance is a policy that offers the optimal financial protection against the loss and at a price you can afford. In this post, I explained all the coverage option you can get. Also, you can lower your insurance cost or premium with the mean of nine different factors. Make sure you compare different companies quotes and rates before you pick any policy. Annual premium makes your insurance cost lower than a monthly payment plan.