Most individuals know that they need insurance for their new car, but many do not research it as it should due to the excitement that comes with owning a new vehicle. Skimping over this aspect can cause substantial financial issues as soon as you leave the dealership. Car insurance is easily one of the most expensive purchases that people hope to ever use and while it is essential to buy the ideal coverage, insurance for new cars is always more expensive than insuring a 3, 5 or 7 years old model. In this read, we are going to mention a few things to keep in mind when shopping for insurance for cars and a few tips on how to keep the premiums in line.
It is always wise to shop for insurance coverage before you even start negotiating on a car. Of course, you should narrow down to the exact make and model you want, but keep the insurance costs in mind during this period as well. When you have narrowed down your vehicle selection, the next step is to look for the right insurance.
Waiting to purchase a car until you have sorted out your insurance preferences can save you hundreds of euros as some cars like sports cars tend to carry higher insurance rates. And while the cost might be affordable, it is vital that you consider the auto insurance as part of it. So, protect yourself, your vehicle and finances by simply considering the following tips.
Know How Long Your Insurance Will Cover Your New Car
If you are replacing a car on your policy, normally, the coverage will extend to your new vehicle. It can be as short as a day or as long as two weeks an so, you should check before you purchase to know what it is instead of assuming you have coverage. Ideally, if you are not replacing a vehicle, then you may not have any coverage whatsoever.
Do Not Assume The Dealership will Handle the Paperwork
The staff is not only usually busy, but it is not their duty to call and add a vehicle to your policy. If they take a look at your card and allow you to leave, it is because they are assuming that you have assessed and know that there is coverage under your policy. Also, if you are leasing or financing a car, keep in mind that the lienholder will mandate that you have liability insurance, as well as comprehensive and collision coverage. So, if you have liability coverage only, ensure that you have comprehensive and collision coverage included if you need it. It does not get added automatically.
Know What is Needed
When purchasing a car, you not only need to know the cost of the vehicle but need to understand what insurance coverage, deductibles and limits you have to buy. For instance, lienholders normally ask for deductibles that are 600 Euros and below. If you are not certain in regards to this aspect, you should consult your insurance agent.
Liability Coverage is What You Usually Need to Drive on the Roads
It is required that you have this type of coverage to pay for injuries or damages that you may be responsible for while driving around.
Cover Yourself with Collision Insurance
Collision insurance protects your car from collisions on the road with other vehicles and objects. This is the primary reason why lienholders ask that you have the coverage as the car is still their asset.
If You Owe More than Your Car Is Worth, Gap Insurance is Mandatory
Your new car will depreciate as soon as you drive off the dealership. There are many cases where owners have had their vehicles totalled right after purchase and owing more than their insurance covers. Gap insurance covers the difference between the value of the car at the time of its loss and what you still owe on it.
Personal Injury Protection is Ideally Important
This type of coverage covers your medical expenses, regardless of fault in an auto accident. Again, ensure that you know what limits, deductibles and coverage you need to pick when shopping for insurance for new cars so that you can get the right quotes. Also, ensure you consult your agent in this regard.
Comprehensive Insurance is for Weather Related Damages
If you live in an area that experiences floods or storms, it is a good idea to get comprehensive coverage. It is still a smart purchase even if you do not experience harsh weather. It protects you in case fire, vandalism or theft damage the car. Also, expect the lienholder to demand that you have comprehensive coverage so the car can be fixed or paid off if it is a complete loss.
Choose a Top Rated Insurer
Of course, you will want to save money on insurance for new cars, but that is not just a matter of finding the lowest premium. Some insurance companies have lower premiums, but they end up costing you more by hassling the auto repair shops to cut corners, lowballing loss estimates and even forcing you to pay additional money for original equipment replacement parts. Some insurers even jack up premiums unfairly after an accident.
Take Advantage of Discounts
Auto insurance companies tend to offer an array of modest, but completely worthwhile discounts that are based on a low-risk lifestyle. If they don’t mention them to you first, here are some you can ask about:
- -drivers who have taken a defensive driving course
- -students with good grades
- -antitheft and safety equipment
- -new drivers who have taken a driving course
- -older drivers who have passed a refresher course
Maintain an Excellent Credit Score
Most places allow insurers to utilise credit score as a factor when it comes to setting your premiums. So, ask your auto insurer if they do that. Regardless, it is essential that you check and adjust credit reporting mistakes. If your finances have been affected by a divorce, death of a loved one, medical issues or job loss, then you may want to ask your auto insurer for an exception. Here are some helpful tips for maintain a good credit score!