If you are in the market to purchase an automobile insurance policy, it may be worthwhile for you to take the time to understand exactly what you are buying. Many people have auto policies but do not actually understand the individual coverages listed on their declarations page. Although the policy itself does explain what you are purchasing, few people take the time to read it and, even when they do, they often do not comprehend the coverage and its limits and exclusions. It would be very difficult to comparison shop for policies if you do not fully realize what you are getting for your money.
There are many ways to purchase auto insurance and a person should choose the one that’s most comfortable for them. For some, however, obtaining the best quote is a challenge and they may want to try several different ways to accomplish this. Read also: What are the differences in auto insurance between states?
One of the easiest ways, of course, would be to stop in and visit with your local agency to discuss your requirements and how much it would cost to be covered by their company. For some, however, an insurance broker would be more appealing because he would do the shopping for you amongst the companies he represents. He can explain any differences between the companies and advise you as to what he believes would be the policy that most closely matches your needs. If personal visits do not appeal to you, a phone call to their offices can provide the same information.
Another means of obtaining insurance quotes is to contact one or more of the companies advertising 800 numbers, who are prepared to ask you specific questions and then provide a quote over the telephone. This is often, but not always, a competitive way to do business and it would be easy to contact several companies so that you can compare rates.
Of course, all companies today have an Internet presence and would be pleased to furnish quotes in this way. One company even offers to furnish approximate quotes for their company plus two others in an attempt to show that their rates are generally less.
As shown above, there are numerous ways to obtain insurance coverage, just pick the one that’s right for you. But first you would want to be sure that you understand the following so you can ask the right questions, compare coverages, and make an educated decision regarding your purchase. An insurance professional should explain these in detail. Read also: Is it wise to accept the maximum deductible to get cheap auto insurance?
Liability – provides protection against financial loss, up to the policy limits you choose, if you injure another person. It would also cover your legal expenses. The other part of this coverage applies to the property damage caused by your auto.
Uninsured/ Underinsured – provides coverage for you in the event of bodily injury or death as a result of an accident with an uninsured motorist with no known policy, or an underinsured motorist, who has a policy that will not meet your needs.
Medical Payments – pays for your medical expenses and those of your family members living in your household even if the accident occurs without your auto involved.
Collision and Comprehensive Coverage
Collision reimburses you for the damage to your auto caused by an accident with another auto, or any stationary or moving object. It is often suggested that an insured drop this coverage if the car is over 7 years old.
Comprehensive will pay for damage to your auto not covered under collision. This would include damage caused by theft, riot, fire, windstorm and hail. Read also: Finding auto insurance when you rent a vehicle.
In the case of both Collision and Comprehensive coverage, you will have a deductible amount that you designate when applying for the policy. The higher your deductible, the lower the premium cost. However, you must be prepared to pay this amount should an accident or other damage occur. The policy will then cover the balance of the damage up to the actual cash value of the automobile.
Towing and Labor coverage is also available at the location where the car was disabled. This is only available if you maintain Comprehensive coverage on the auto and is usually limited to set a dollar value such as $25 or $50.
Rental Reimbursement is another optional coverage to cover costs while your auto is being repaired. Various options are offered in different states so check with your agent to see what is available to you.
When discussing Liability coverage with your insurance professional, inquire about the availability of a Personal Umbrella Policy (PUP) and how it could benefit you. The cost is minimal and the coverage is great. It does, however, require that you carry high limits of liability on your home and auto, but, in exchange for a reasonable premium, it will extend your coverage to $1,000,000 and, even more in some states. Many people have Umbrella policies and they definitely provide some peace of mind in the event that you are ever sued.