Buying just the minimum coverage when it comes to
car insurancemay seem like a good way to save money. But this is actually a very common car insurance mistake that could end up costing you thousands.
Look at it this way—a simple, cheaper, bare-bones policy means you’ll pay more if an accident occurs. While it’s tempting to seek ways to immediately
save money, you also want to make sure you have enough coverage if something does unfortunately happen.
Balance is the key to avoiding this car insurance mistake
The key to avoiding this common car insurance mistake is to find the right balance of adequate coverage and a monthly premium you can afford. In this case, cheaper doesn’t necessarily mean it’s the better choice.
Instead of looking at price only, shop based on
price and coverage. This way you know if you’re adequately protected or if you’re subject to a high deductible.
The role deductibles play in this car insurance mistake
deductibles, they’re an important part in determining how much your car insurance costs. When an accident occurs, your deductible is applied to the damages first—so it’s the amount you pay before insurance kicks in.
For example, if you have a $1,000 deductible, it means you are responsible for paying $1,000 if an accident occurs.
If you have a lower deductible, you’re going to pay more each month, while a higher deductible means lower payments.
However, with a lower deductible, it also means more coverage and that you will pay less out of pocket should an accident occur.
So, while it may be tempting to choose the plan with lower payments each month, someone who is on a tight budget might want to consider the opposite.
Review your own finances and claim history. If you’re concerned about covering the out-of-pocket costs associated with an accident, you may want to consider choosing a lower deductible plan.
Know what coverage you need for your car
Another way to avoid this car insurance mistake is getting the right coverage for your particular vehicle. You want adequate coverage—however, it doesn’t make sense to pay more for a car that would cost less to be replaced.
Once again, it comes down to having enough coverage in case there’s a problem. However, it doesn’t make sense to pay for a plan that costs you more than your car is worth.
Compare and save to get the best deal on car insurance
If you’re still unsure if you’re successfully avoiding this common car insurance mistake,
Jerry’s free app compares quotes from up to 45 different insurance companies for you in under a minute, helping you save as much money as possible without losing out on valuable coverage.
Jerry will send you quotes that compare to your current coverage—and as a licensed broker, it takes care of your insurance needs from start to finish. The app also monitors your car insurance rate every six months on an ongoing basis.
Car insurance can seem overwhelming, but with Jerry, you’ll know you’re getting the best rate and coverage possible.