How to Know if You Have the Right Type of Car Insurance For You
Find out if you’re getting ripped off on your car insurance in less than two minutes.
No long forms · No spam · No fees
If your health insurance needs change as you get older, why should you keep the same car insurance policy year after year? Simply put, you shouldn’t and for many American drivers, there could be untapped savings available that you don’t even know about. According to a NerdWallet study, Americans could save on average $859 a year by simply shopping around for car insurance.
So, how do you know if you have the right type of car insurance? Here are some questions to ask.
Does your car really need collision insurance?
This might be the most common way people overpay for their insurance as many older cars simply do not give the best return on investment when it comes to collision insurance. This is the type of coverage that will assess the value of your car in the event of an accident, and repay you based on that assessment minus your deductible. While this is imperative for newer cars, for ones that are 10 years old or older you might end up losing money after a crash.
If your premiums with collision insurance are more than 10% of the total assessed value of your car, then you’ll probably be disappointed with your payout after an accident. Talk to your car insurance agent about the value of your car and ask them bluntly if they think you’ll save money in the long run by removing collision insurance. The money you save from dropping that coverage can be used to save up for a newer car.
Are you getting the most savings for your safe driving?
If you don’t drive that often and believe yourself to be a safe driver, why should you pay the same for road warriors burning the midnight oil? In the past five years, American drivers overpaid more than $100 billion for car insurance, which has led some insurance companies to offer usage based insurance programs to more acurately bill drivers. This allows for increased savings for people who drive less than 12,000 miles a year, don’t drive at night, and avoid potentially dangerous situations like excess highway speeds.
If you’re a safe driver living in a low-mileage, urban environment, talk to your car insurance agent about usage based programs. You might be able to cut a lot off your premiums.
Does your car insurance company know of recent life changes?
If you recently bought a house, married a spouse, brought a new life into this world, or even added an extra set of wheels to the driveway, your insurance company should know about it. Most providers offer discounts for life changes such as these and can even bundle your car and homeowner policies together for increased savings.
There is no one-policy-fits-all for car insurance. Getting the coverage that’s right for you means knowing what milestones affect your rates and what you can do to lower them.