 | Your car insurance rates are based on a few factors you can't readily change -- your sex, age, marital status and where you live -- and many that you can -- your credit scores, what you drive, how well you drive and how much coverage you buy. |
Let's review the auto insurance basics.
Liability insurance pays for injuries and property damage caused by a crash if an insurance adjuster determines you were at fault. It does not cover your injuries or those of other people on your policy, or damage to your vehicle. State minimum requirements provide inadequate protection. Buy no less than $100,000 per person, $300,000 per accident and $50,000 for property damage, or no less than $300,000 if your policy has a single limit. You are personally liable for claims that exceed your coverage, so buy even more if you can, and consider an umbrella policy.
Uninsured/underinsured motorist protection covers injuries to you and the occupants of your car -- the other driver has no insurance or too little. This is one of, if not the the most, important and least costly coverages you and purchase. "One of the best kept secrets in the insurance industry."
Collision insurance pays for damage to your vehicle in an accident. If your car is totaled, you'll get what the insurer considers the pre-crash market value of your car, minus your deductible. To get a general idea of what that may be, check the Kelley Blue Book private-party price or visit the Web site of the National Automobile Dealers Association. You can pay extra for replacement-cost coverage for newer cars.
Comprehensive insurance covers theft of your vehicle and noncollision damage to your car, as well as animal collisions. You may be eligible for lower rates if your vehicle has anti-theft and tracking devices.
Medical or personal-injury protection provides coverage for you and your passengers, regardless of fault. You may not need this insurance if you have good health insurance.
Gap Insurance if you owe more on your car than it's worth
Saving Money on Your Auto Insurance:
- Increase your deductibles on comprehensive and collision coverage to an amount you can cover out of pocket.
- Ask your independent agent about all available special discounts.
- If you're switching insurance companies, do it in writing. Your credit scores will suffer if you're canceled for nonpayment.
- Pay all bills on time. Your premiums are based in part on your credit scores or an insurance risk score based on your credit reports..
- Do not lend out your car. If your friend wrecks it, your rates will go up. If your uninsured friend wrecks your car, you'll be liable for claims exceeding your policy.
- The type of vehicle you drive affects your rates. Check the cost of insuring that sports car before you buy it. You will pay higher premiums for a vehicle with higher collision-damage costs or that's attractive to thieves. No, it doesn't cost more to insure a red car.
- If you get married, you'll get a discount and benefit from combining policies.
- Adding your newly licensed teen to your policy will increase your premiums 50% to 200%. One way to reduce costs: Buy a beater and list your child as the driver. Teen drivers can get discounts for drivers ed courses or good grades.
If you wreck your car
- Tell your insurance company for your own protection, even if injuries are not readily apparent. Informing the company doesn't mean you're filing a claim.
- If you disagree with the
value assigned to your totaled vehicle, provide quotes from local
dealers and proof that your vehicle was well-maintained. Your options
are mediation, arbitration and, finally, a lawsuit.
Contact Stratton Insurance Group to get a quote. We all believe that it will never happen to you but there is always that chance and it can be very expensive to replace your auto, or make right your liabilities.
