6 Considerations to Make When Buying Auto Insurance

Auto insurance is a costly but important part of being a vehicle owner and driver. As customers’ demands have increased, the industry has responded by increasing service offerings. Unfortunately, though, variety can create confusion when it is time for one to shop for driving insurance. By knowing the options, what increases cost and what extras are available, one can get a good quote and the reassurance that goes along with it.

Liability Coverage

Liability insurance is designed to cover damages caused by a policyholder’s vehicle. The coverage level varies with policy type. This type of coverage does not pay for damages to the driver’s car or body. Some type of liability coverage is required in all but a few areas.

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Collision and Comprehensive Insurance

This type of coverage pays for self-inflicted damage to a person’s vehicle. For instance, if a driver hits a guardrail on the way out of the car lot, collision insurance would pay for repairs. Comprehensive coverage pays for replacement in cases of vandalism, theft, and other non-driving events.

Uninsured Motorist Coverage

Although all areas require motorists to have a minimum amount of insurance, this level of coverage may not be enough to pay for damages in an accident. Under- or uninsured motorist coverage pays for repairs when the state minimum is not enough, or when the other driver has no coverage at all.

Actual Cash Value

If a vehicle is totaled in an accident, the driver is paid only its fair market value. When one is still paying on a car that has lost value, the coverage may be less than what is still owed. Gap insurance is optional coverage that pays for these potential losses.

The Excess Provision

The excess provision is different than the deductible; it refers to the threshold that must be met before insurance coverage begins. For instance, if a policy has an excess amount of $15,000, the company would pay nothing unless a claim exceeds that amount.

Look for Perks

When a driver shops for an auto car insurance quote, they should consider the available extras. Add-ons such as towing, tire repair and roadside assistance can add a significant amount of value to the policy, but it increases premiums as well.

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