A lot of things need to be considered and discussed when it comes to buying auto insurance. However, sometimes people rush things over and purchase insurance which does not suit them and their needs. To ease your work we created a list of questions you need to ask before buying auto insurance.
1. What kind of coverage do I need?
Depending on your state, you will need to buy some kind of basic coverage. Most states only require liability insurance which provides financial protection to anyone who’s injured or dead as a result of a car crash you caused. It also covers the damage to their vehicle, any property and legal fees. However, if you think you need a higher level of protection, then there are many other options you might choose from, such as:
- Uninsured and underinsured motorist protection,
- Personal injury protection.
2. What are my state’s car insurance minimums
All states have financial responsibility laws that require you to purchase at least liability coverage. State’s minimum liability and property damage coverages are two of the most important coverages you need to have in order to drive legally. Other than that, each state has its own numbers for the Minimum State Car Insurance Coverage. Most states require at least $40,000 of insurance per accident, but some require as much as $100,000 in coverage. For example, the insurance requirement numbers in California are much lower – they are: 15/30/5. It may seem confusing at first, but in reality, these numbers simply refer to the insurance policy limit.
If you want to find out more about Minimum Car Insurance Requirements, you can read our latest blog post about it.
3. What is my risk assessment?
Your insurance rate highly depends on your risk assessment, and there are several factors that determine how much of a “risk” you might pose to the insurance company. Those factors are your age, gender, driving record, criminal record and where you live. These factors might seem confusing and strange, but they play a major role in your risk assessment. Just know that the more of a risk you pose, the higher your rate will be.
4. What will my deductible be?
If you get into a car accident and file a claim, then you will probably need to pay a specific amount of money – your deductibles before your insurance company pays for the rest of the expenses. The rate of the deductibles can vary from $0- $1,500. You can also lower your premium by raising your deductible. It might be a wise move in case you never get into a car accident. However, you can never be sure about it so it’ll be safe to have a decent amount of deductible just in case something happens. Also, if you set your deductible too high, you might not be able to pay for it, and your vehicle will not be repaired.
If you have questions about Car Insurance, feel free to contact us.