Although there are many responsibilities that come with car ownership, obtaining car insurance is often considered the most vital. This is because the car is one of the biggest financial investments people will make in their life which they need to take care of properly so they can protect both themselves and their vehicle from potential liabilities.
In general, the main purpose of car insurance is to provide owners with financial and legal protection and cover for damages and injuries sustained in an accident. It is required by law in almost all countries in the world and can be tailored to match the unique needs of a driver.
For this, people usually consult with reputable brokerages such as Aha Insurance to get advice from professionals and help them choose the right coverage for the best price.
To help you along, we have written the ultimate guide outlining five important questions you should ask your agent to make an informed decision when purchasing car insurance.
1. How Much Is The Premium?
The cost of car insurance is probably the most important thing about car owners. In the insurance world, this cost is called a premium and it refers to the amount you pay your insurance company for your policy. To calculate this amount, companies take several factors into account including:
- The type of car;
- Age and gender;
- Driving history and habits;
- Credit score.
For example, if you are a responsible driver with few or no traffic violations at all, the rate you will have to pay for your premium will be much lower than if you have been in multiple accidents.
2. What Is The Best Type Of Coverage?
Another important question you should ask your insurance broker is to help you pick the best type of coverage for you. In general, there are several types of car insurance coverage you can obtain, some of which are mandatory and others are optional.
For example, liability coverage is required by law in almost all countries in the world and it covers the cost of accident-related injuries, vehicle damage, property damage, and legal fees. Besides this coverage, you can ask your agent to recommend additional ones that best suit your individual needs. Some common options include collision, comprehensive, and uninsured/underinsured motorist coverage.
3. What Payment Methods And Options Are Available?
Depending on your car insurance policies, there are several common payment methods your insurance agent might offer you. These include using a bank account, debit card or credit card, checks, and money orders.
As for how you should make your payments, most car insurance companies offer customers several options such as paying for their car insurance all at once, yearly, monthly, quarterly, and with two payments every six months.
In many cases, people choose to make an annual payment for which they usually get a discount on their overall premium.
4. Are There Any Discounts On The Policy?
Because car insurance can be costly, if there is any way you can lower your premium, you should definitely take advantage of it. Most insurance companies offer various types of discounts, so make sure you ask your insurance agent if you are eligible for any of them.
For example, a great way to save on your insurance policy is to bundle two insurances together like your home and car insurance, or if you have two cars.
Other possible discounts you can get are policy renewal/loyalty discounts, paperless discounts, good driver behavior discounts, and vehicle-based discounts.
5. What Is The Deductible Amount?
The deductible refers to the amount you pay out of pocket in cash before your car insurance kicks in after sustaining damages or injuries in an accident. This amount typically depends on various factors including your policy limits, the type of car insurance coverage, and the specific circumstances of the incident.
Although higher deductibles can lower your premium, you should not make the mistake of setting the deductible too high only to find out you cannot afford to pay it in the event of an accident. To make an informed decision, consult with your agent about what is the right deductible amount for you.
As a responsible car owner, obtaining car insurance is a very important task you need to complete. Since there are so many things to consider, it is best that you seek advice and guidance from a trustworthy insurance agent to help you choose the right car insurance coverage that matches your needs and fits your budget.
If you need help, use our post as a reference and get all the right information from your agent.