You can really save lots of money and get significantly better coverage by shopping around for your car insurance. Car insurance companies all have various rates. And there are many other aspects of your coverage to consider. So, shopping around helps you to get a good deal, and exactly the right coverage for your situation. These are 10 questions to ask car insurance agents in your area:
- What kind of coverage should I get?
- What is my risk assessment?
- Who can drive my car?
- What is my deductible?
- Can I get a discount?
- What payment options are available?
- How will my car be valued?
- Is there a 24-hour claims service?
- Does the coverage include original manufacturer parts?
- How do I meet with my insurance agent?
Know the questions to ask, so you get the same in-depth info on each coverage option. It’s the answers to these questions that make it possible to fairly compare plans.
What kind of coverage should I get?
The state mandates a certain amount of coverage. Usually, you only require liability insurance to cover the cost of anyone else when you are at fault. This covers injury, death, vehicle damage, other property damage and their legal fees. It also covers any other consequences of those who sustain injuries in the accident. This coverage is the absolute bare minimum necessary to be legally allowed to drive the vehicle.
Liability insurance protects you as the driver if you’re responsible for the accident. It even pays if you are held responsible for the accident, even if you didn’t technically cause it. But other coverage is essential, too.
- Collision – Covers repairs to your car, no matter who is at fault. You pay the deductible, and your insurer pays the rest. This level of vehicle insurance covers the repairs to your vehicle needed after a traffic accident, even if it’s your fault. It covers property damage and vehicle damage if you hit a tree, building, garage door or fence. Collision insurance has an optional replacement provision. So, if your car is “totaled” by the insurer, you can buy coverage to get a replacement vehicle of the same value. Or you can use the money as a down payment on another one.
- Comprehensive – Pays for the damage from non-crash events to your vehicle. Damage like fire, theft vandalism, and acts of nature.
- Uninsured and underinsured motorist protection – Some states require UM and UIM. This coverage pays the costs of repairs if an uninsured or underinsured motorist hits you. No deductible, but typically a pretty low limit (about $3,500.)
- Personal injury protection – Pays for your passengers’ lost wages and medical expenses if someone hits you. It also covers your medical bills if you’re injured as a passenger in someone else’s vehicle.
What is my risk assessment?
Insurance rates consider several factors. That combination of factors is called your “risk assessment.” The insurance company decides how likely they think it is that you will make a claim. The greater the risk, the higher the rate. Insurers consider your age, sex, driving record, credit rating, criminal record, and location.
Who can drive my car?
Do you have teens in the household? Can you lend your truck to a friend to move on the weekend? Can you borrow someone else’s car or rent a car and be covered? Every insurer and state manage these situations slightly differently, so find out!
What is my deductible?
Your deductible is how much you pay out of your pocket in cash before the insurance company pays anything. Don’t set the deductible so high that if you have an accident, you can’t afford the deductible. Because if you can’t pay for the deductible, your vehicle won’t get fixed.
You can choose from deductible amounts like $0, $100, $250, $500, $1,000 or even $1,500. The lower your deductible, the higher the premium.
Can I get a discount?
Every insurer offers discounts, and you probably qualify for some. But discounts don’t come automatically. Inquire about the discounts (sometimes agents call them credits.) Ask about things like:
- Safety features in your vehicle – i.e. car alarm and airbags
- Clean driving record
- A good student – up to 23 or 25 with at least a B average in high school or college
- Parking your car inside a garage
- Hybrid vehicles
- Professional organization membership
- Graduating from specific colleges and universities
What payment options are available?
You can pay your car insurance all at once, in an annual lump sum payment. But if you would be making monthly payments to your credit card company, your insurance agent might have a better deal. Options include monthly installments, quarterly payments and even 2 payments every 6 months. There could be a surcharge, or maybe a discount if you pay it all.
How will my car be valued?
Before you buy a vehicle, make sure you find out the book value. Then check to see if the insurance payments are affordable. The value of the vehicle is a significant factor in your insurance premiums.
Is there a 24-hour claims service?
A fender bender on Friday night makes for a stressful weekend unless you opt for an agent with 24-hour claims. Lots of insurers offer 24/7 reporting for claims, with a toll-free number or online.
Does the coverage include original manufacturer parts?
When your vehicle needs repair, some insurers don’t pay identical parts from the car’s manufacturer. The “original equipment manufacturer” (OEM) parts cost more, so they like to use “aftermarket” parts if they can. Some states require OEM parts, but others don’t. So sometimes insurers pay for certain types of OEM parts like airbags. But the use aftermarket parts for replacements like door handles or fenders.
OEM parts are not a deal-breaker. But if you care, you can pay the extra to upgrade to OEM parts on specific replacements, if you prefer a lower overall premium. Just know ahead of time.
How do I meet with my insurance agent?
In these currently uncertain times, it is nice to have a choice when it comes to meeting with your agent. Are they willing to work with you over the phone? On a Zoom or Skype call? Will they drop-off and pick-up paperwork? Or do you have to go to their office in person?
A lot of business is conducted online and over the phone. But complicated insurance matters can be fairly lengthy discussions. And you may want to have your spouse involved in the conversation.
So, ask potential agents about the options for how you can meet. Flexibility is key.
In Summary
Even if you know a fair amount about car insurance, it is easy to end up paying more than you should. When renewal time comes, your monthly payments may only go up a small amount, so you may not even notice. Vehicles get older every year, and as time flies by, it may be better to drop that collision coverage. So, at least annually, your insurance agent should carefully go over your car insurance coverage with you. Ask your agent these 10 questions every year to be sure your coverage is up-to-date and fits your ongoing, changing situation.
