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May 12, 2022

Not All Car Insurance Coverage is Created Equal

When shopping for car insurance, most drivers look for the cheapest option. While it’s important to save money, you should also avoid singing onto the cheapest policy without considering the policy’s coverage. Not all coverage is created equal and certain policies may leave you without the coverage you need.

Low Credit Money Trap

Some car insurance providers offer very low rates for drivers with poor credit or a spotty driving record. Poor credit and a poor driving record can make your premiums leap higher, but it’s important not to fall into the trap of hidden fees. Some agencies offer low premiums but hide additional fees in order to make up for the risk of insuring a nonstandard driver. Always be sure to read the fine print before singing the dotted line!

Lower Cost May Mean Lower Coverage

It’s true that you can save money on car insurance by purchasing lower coverage amounts. This isn’t recommended, however, because it leaves you and your vehicle open for even more expensive loss or damages. The only coverage that is generally required by all states is liability insurance. The other coverages are designed to protect you, your passengers and your vehicle in case of an accident. Full coverage car insurance typically includes liability as well as:

·        Comprehensive coverage provides compensation for damages to your vehicle in case of fire, wind, hail, falling objects, theft, vandalism and more.

·        Collision coverage provides compensation for damages to your vehicle in case of a collision with another vehicle or object.

·        Medical Payments helps with medical expenses for the driver and their passengers after an accident.

·        Uninsured/underinsured motorist coverage helps cover damages after an accident involving a driver who isn’t carrying insurance at the time of the incident.

Many drivers choose to cut back on these coverages in order to save money. What is important to keep in mind is that an accident can cost thousands more in a split second than your insurance will cost you in a year. You and your passenger’s injuries won’t be covered without medical payments coverage, leaving you to pay for both out of pocket. Hospital bills and emergency care services are known to be expensive.

Before cutting back on coverage, consider saving money in other ways such as asking about discounts, raising your credit score and taking defensive driving classes to earn more discounts.

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