Car Insurance

As a consumer, you need to understand the basics of car insurance. Taking the time to learn something about auto insurance for your vehicle will mean that you will be able to choose the best type of coverage for your car.

Under state law, in most parts of the U.S., you are required to have auto insurance in place or be required to pay a fine. Take a minute to understand your needs and the available options before getting quotes for coverage.

When you are finished learning some money saving tips for lowering your car insurance rates then be sure and use our free online car insurance quote finder at the top of the page to compare rates from competing car insurance companies.

Car Insurance: Factors To Consider

When you are looking for auto insurance, you need to take the following factors into account:

The Laws of Your State

Before you decide to buy car insurance, find out what the minimum legal requirement is for insurance where you live. Although you do need to buy at least that amount of coverage, it doesn't mean that buying only the minimum is the right choice for you. Fifteen state require car owners to buy Personal Injury Protection (PIP). PIP is an important part of your insurance plan, since it pays for your medical expenses and lost wages if you are injured in an accident.

People buy insurance to protect their assets. If you were involved in a serious accident for which you are at fault, your insurance policy would pay for damages, but only up to the policy limit.

Any expenses over the amount of your policy limit will need to be paid by you personally. Not having adequate insurance may mean that you will have to sell off your assets to help to pay what you owe. Do consider what you own and how hard you have worked to get it when you are trying to decide what level of insurance coverage to buy.

Coverage Options

Contact your auto insurance company or agent to find out what options are available to you. Once you have this valuable information, you can decide what you would like to add to your policy. Some policies will pay for the cost of a rental car while yours is being repaired, and others include an extended warranty to cover parts and labor if the car breaks down.

Ask about gap insurance if you lease your vehicle. It covers the difference between the cost of the insurance company's payout and the amount you still owe on your lease if the car were totaled in an accident.

Your Budget

Once you have a good understanding of what the minimum legal requirements are for your state and the type of coverage you need, you need to consider your budget. The idea is to get the best level of coverage at an affordable price.

Be sure to ask your insurance company or agent if you qualify for any discounts on the cost of your coverage. Many insurers offer discounts for mature drivers, those who have maintained a clean driving record for a number of years, those who have multiple policies with the same insurance carrier, and more.

Your Other Insurance Policies

Before you apply for auto insurance coverage, examine any other insurance policies you have in place. Your existing health insurance or homeowners may provide coverage for you if you have been involved in an accident. A person who already has a comprehensive health insurance policy in place may only need to buy the minimum level of PIP required by law to meet their needs. Also, many insurance companies offer a discount for purchasing both your homeowners insurance and your car insurance from the same company (called a “multiple lines” discount).

Car Insurance: How To Avoid Paying Too Much For Coverage 

If keeping your insurance costs down is important to you, keep these suggestions in mind to avoid paying more than you have to for your auto insurance:

1. Avoid buying a car that is more expensive to insure. An insurance company or your auto insurance agent should be able to provide you with a list of cars that are most likely to be stolen. If you choose to buy one of them, you may be paying a higher rate on your insurance premiums. You will also want to avoid buying a car that is expensive to repair, since this fact will also have a bearing on your insurance costs.

2. Keeping a clean driving record over a number of years will also help keep your insurance costs down. If you are a new driver and have taken a drivers' education course, let your insurance company know. You may qualify for a discount on your rates because of it.

3. Insurance companies consider the number of miles you put on your vehicle each year when they are determining your level of risk (and your premium rates). You may be able to get a better rate for your coverage if you use public transportation to get to and from work and only drive your car for short trips. Not only could you have money by adopting this course of action, but you will be helping the environment, too!

Car Insurance: The Deductible 

Your auto insurance policy will include a deductible. While you buy insurance to pay for damages if there is an accident, you are expected to pay a certain amount toward them yourself. This amount is your deductible, and you will need to cover that amount before your insurance coverage kicks in.

Choose the amount of your deductible carefully. When you choose a policy with a higher deductible, the cost of your premiums decreases but you want to make sure that you can afford to pay the deductible amount out of your own pocket.

Auto Insurance Terms You Need To Know 

Here are some auto insurance terms you should be familiar with:

1. No-Fault Auto Insurance: In many states, rather than sue the other driver (and his or her insurance company after an accident), the injured person will get paid by their own insurance company for medical expenses, damage to property, and lost wages. If the level of damages is over a certain level, most states still allow the injured person to sue the at-fault driver.

2. Term: The term of your policy is the length of time your coverage is in effect.

3. Usage: Your car's usage refers to the reason you are using it. If you are using your vehicle for business purposes, you will likely pay a higher premium for your insurance coverage.

4. Split Limit: Some policies have separate limits for the different types of coverage they provide. These are known as "split limit" policies.

Compare Online Car Insurance Quotes Now!

Find out more about auto insurance by clicking on the quote tool at the top of this page.

It's free, easy to use, and will allow you to view personalized car insurance quotes from top auto insurance companies like GEICO, Esurance, Progressive, State Farm, Farmers, Allstate, AIG, and more!

Get started seeing how much you can save by comparing auto insurance quotes today!