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5 Things to Keep in Mind While Buying Car Insurance

A car of a person who did not have car insurance is damaged by a fallen tree

Buying car insurance from a third-party provider is mandatory in most states but opting for a comprehensive car insurance policy that covers any damages to the car is up to each car owner. You cannot anticipate or predict events of losses, and it is always safer to buy an insurance plan for your car. However, research and knowledge go a long way in deciding on the right plan from the right car insurance company.

1. Car Insurance Coverage

It is important to know the scope of a plan’s coverage before buying car insurance. Different insurance providers have different policies and different plans offer different coverage. You can research on the providers’ websites or ask the insurance agent to inform you about the coverage as well as the exclusions.

2. Add-ons and Discounts

Many insurance companies offer discounts on insurance premiums if you upgrade your vehicle with security devices and gadgets. Similarly, companies may offer discounts to attract new customers away from competitors. There are also many kinds of add-on covers to offers like zero-depreciation cover. The depreciation cost of the vehicle is something the insurance company will cover. So, the total depreciation of your car during your insurance period will be paid to you by the insurer.

Another add-on would be a no claim bonus. If you do not claim for damages, your premium will keep getting discounted each year. Other add-ons and discounts are also available when it comes to buying car insurance. Be sure to understand exactly what you need and what your policy covers.

3. The Reputation of the Car Insurance Company

It comes as a big shock if your insurer rejects your claim after your car has been damaged. It’s equally as frustrating if they delay on fulfilling their promises. Insurance companies that are well-reputed and have a good claim settlement history should be your go-to business to invest in.

4. Excess

Excess is the amount the insured party has to pay while claiming for damages. The purpose of excess is to prevent parties from claiming for every scratch or dent. Companies have a compulsory excess amount that is not negotiable. However, you can set a voluntary excess yourself. The higher the excess, the lower the premium amount will be. It is important, however, to keep your budget in mind along with your needs.

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5. Courtesy Cars

A courtesy car is what your insurance company provides you with while yours is away for repairs. It is best to check if the company has this policy or not. Most companies offer a basic car, and you have to pay them extra to get a better one. Also, some insurers’ policies have a maximum time limit for how long you can hold on to the car. It is recommended to go through the company’s policies.

Buying a new car is an exciting ordeal that brings a little risk with it too. However, buying car insurance with proper policies can alleviate your fear and most of the risk. Knowing the intricacies of the policy you are buying and researching the insurer you are buying from are two things you should practice every time you buy car insurance.

Written By

Riley is a finance, lifestyle, and entertainment writer living in San Diego. He received his bachelor's degree in Journalism and Multimedia from the University of Oregon. His work has been featured in many finance and lifestyle publications throughout the US. When he is not writing, Riley enjoys reading and hanging out at the beach with his dog.


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