Auto Insurance FAQ

Auto Insurance FAQ that Will Save You Money

Here are the auto insurance FAQ (frequently asked questions) that I receive the most.

What are car financial responsibility laws?

These are the laws in your state that require you to prove you are financially capable to shoulder whatever responsibility that may arise while driving your car.

What happens if I choose not to purchase car insurance and still drive my car?

It differs from state to state.  Except for New Hampshire and Wisconsin where car insurance is optional, every state requires all drivers to be insured.  If you refuse, you may face substantial penalties that may include fines, revocation of your driver’s license, and even serving a sentence in jail.

Is anyone who drives my car covered?

The answer to this question is yes, provided the one who drives the car has the insured person’s consent to drive the car.  The insured person is the one named on the insurance policy, sometimes including his or her spouse.

In this regard, you will have to see to it that you understand your own insurance policy.  For instance, you may need to have everyone living in your household who has a driver’s license listed on the insurance policy.  If a driver from your household is not listed, he/she will not be covered.

What are the best liability policy limits?

Insurance agents generally agree that the minimum policy required by all states is insufficient.  They propose the ratio of 100:300:100 for the average driver.  This can be illustrated as follows:

  • $100,000 per person for bodily injury
  • $300,000 per accident for bodily injury
  • $100,000 per accident for property damage

In most states, the cost of medical treatment is comparable so these guidelines apply across the board.

However, you may need to take into consideration the policy limit on property damage if you are not an average driver.  If you live in an area with exceptionally high real estate prices, you may want to consider higher limits.  Keep in mind that if you are at fault, coverage for property damage refers to the other car and any other real or personal property that may have been damaged in the accident.

My teenager just got his license.  Does he need to be insured?

Yes, in most situations.  Remember that every person in your household who has a driver’s license must be listed on your insurance policy, unless of course they have their own auto insurance policy.  So if your teenager has just received his own driver’s license, or you have a son or daughter who is a college student and uses your address as his or her permanent place of residence, you should have their names listed on your auto insurance policy.

What considerations are involved when an insurance company decides whether to cancel or not renew a policy?

Insurance companies assess risks relevant to each policyholder and then decide if the policy holder is a “worthwhile risk” or if his policy should be canceled.  This means your claims, driving, and credit history in addition to other factors. Insurance companies will view you in a favorable light if you don’t have a record of filing frequent claims and have clean driving and credit histories.


Auto Insurance Student: What You Should Know

Guide for Auto Insurance Student Drivers

Nothing beats the thrill of driving your first car.  Your heart is racing, your head is throbbing and every sense is heightened.

Unfortunately, you’ll experience the same feelings when you have your first accident.

Hopefully, you will be covered for the worst.  But since teenagers are the most accident-prone drivers due to their inexperience, car insurance for students tends to be expensive.

In fact, car accidents kill so many young drivers every year…to the extent that some states have made it a requirement for new drivers to get a Graduated Driver License.

If you’re not already familiar with the Graduated Driver License, it allows a teen driver to drive under a learner’s permit status for the first 6 months to 1 year. At all times, a more experienced driver must be in the car when you drive.

After this learning period, you will be expected to pass a driving test and a written exam.  Only after this will you get a provisional license permitting you to drive without someone on board watching you.  Restrictions include limited passengers, night driving and cellphone usage.

You will  be given your full license after completing the provisional stage with no accidents or moving violations.  The authorities will pay particular attention to alcohol and drug related offenses.

The great thing about this program is that it has actually helped reduce car accidents. So pay attention while you’re in it! Learn and absorb all you can. Model drivers get cheaper rates and here are some more tips to make sure that you get the cheapest rates possible.

Auto Insurance Student Tip #1 – Get good grades.

Now, what does this have to do with your car insurance? A lot. You don’t necessarily have to be an A-lister but you do need to maintain a B average if not higher. Common sense dictates that the student with higher grades is tends to be more responsible and less likely to crash a car.

Auto Insurance Student Tip #2 – Inform your insurance company of your car usage.

Let your insurer know that you will only be driving the insured vehicle from time-to-time.  Assure them that you will only be driving it on holidays or weekends since most of the time, you will be living on campus anyway. Did you know that insurance companies actually give special rates to students in this type of situation?  Not just that–they’re also cheaper compared to the rates given to regular drivers.

Auto Insurance Student Tip #3 – Avoid the big hit…learn about renters insurance.

You probably don’t think you have a lot of assets. But think carefully about what you have in your backpack or at the back seat of your car. An iPod, a smart phone, a laptop, and a bunch of our gadgets that will probably add up to a sizable sum. Inquire about renters insurance because for just a small sum, you can get these small items covered.  That way, you don’t have to worry so much about safety and security while you’re out shopping and those items are in your backpack.


Womens Cheap Car Insurance

What Women Should Know About Buying Car Insurance

Car insurance companies offer cheaper rates to women compared to their male counterparts.  Before you decide this is purely sexist, consider reading the rest of this article.  If you are a woman driver, this advice is especially tailored to you.

Purchasing Auto Insurance

The statistics published by the Insurance Institute for Highway Safety (IIHS) indicate clearly why car insurance companies offer women’s cheap car insurance.  Consider the following from the IIHS’s statistics:

  • Women drivers are involved in less car accidents than men.
  • They are less ticketed for speeding and other moving violations.
  • Male car accident casualties outnumber those of women.
  • Women drivers wear their seat-belts more often.
  • Women drivers do not drive as fast as their male counterparts resulting in less damage and injuries during accidents.

It seems to follow that insuring women drivers is a less risky proposition…make sense?

However, at the other side of the coin is a IIHS report indicating that women are becoming more aggressive at the wheel.  Recent statistics reveal that the number of women motorists dying in vehicular accidents increased 14% as compared to an 11% decline for male motorists for the same time frame.

If this trend continues, the favorable rates that women now enjoy may become a matter of history in the not so distant future.

Insurance Claims Services

Insurance companies take different approaches in handling auto insurance claims. It’s a matter of concern for women drivers that they are treated fairly when claiming their insurance benefits.

If you, as a woman driver, believe you are not being treated fairly by your insurance provider, you have every right to file a complaint with your state insurance regulator.  Please keep in mind that it may take an extra dose of patience to get the matter resolved to your satisfaction.

Tips for Buying Car Insurance

Here are a few tips for you to consider before making a decision to buy auto insurance.

1.Know the minimum amount your state requires for auto insurance. However, it would be to your benefit not to settle for the minimums.

2. Know at least the basics of the different types of insurance cover. This may require a little homework on your part, but a basic knowledge of the differences between liability, collision and comprehensive coverage will certainly help in making prudent coverage decisions.

3. Ask for discounts. If you are a good driver, an excellent student, a senior citizen, a non-smoker, or if you purchase another type of insurance from the same company, you may be entitled to discounts.

4. Consider raising your deductibles to save money.

5. Do a little research on claims handling practices.

6. Know that buying online may result in a much better deal.

7. Lastly, take time to read your policy…before you buy.


5 Tips for Buying Car Insurance at Lowest Price

Car Insurance Lowest – How to Buy

Things have changed with the advent of the Internet. Comparison shopping online has never been easier and savvy shoppers know it.  Thinking of saving on your car insurance yourself? Do you want to avail of car insurance at the lowest possible prices? Read on to learn five money saving tips on car insurance.

Car Insurance Lowest 1 – Research, research, research!

You would think that the quotes given to you by every auto insurance company would be the same. But in reality, they’re actually very different. Guilty of beating the red light way too often? Or are you America’s model driver? Auto insurance providers give rates based on your driving history. And it’s up to you to find out which of them gives the best rate for your track record.

Car Insurance Lowest 2 – Don’t go for big and branded

Think small and specialized. Not proud of your driving record?  Look for companies that specialize in high-risk auto insurance policies. And as much as possible, get one from your locality. Their rates are not only far more competitive but they might also be more willing to negotiate with you.

Car Insurance Lowest 3 – Use Online Insurance Companies

Have you considered shopping at auto insurance companies that can only be found online? Those without traditional storefronts usually pass their cost savings to the consumer by giving them dramatically lower premiums. Not only is this for auto insurance companies but also for other shops that have chosen to be a pure online entity. But only if you’re comfortable with this set-up. Some customers are willing to pay higher rates for a physical offline presence and an actual human person that they can talk to face-to-face should anything go wrong.  Not just that, they also feel that it’s easier to run after these companies should they feel like they’ve been swindled.

Car Insurance Lowest 4 – Simplfy Your Auto Insurance Policy

Cut the fat out.  If you’re reeling from the effects of the global crisis like most people, cut corners when it comes to your insurance.  Of course, that doesn’t mean that you should just get the minimum requirement for auto insurance lialibility by your state! Inspect your car.  If it is significantly depreciated because it’s an old one, consider taking out both the collision and comprehensive coverage.  If you are insured for things that are unlikely to happen, try eliminating that from the policy.

Car Insurance Lowest 5 – Conduct a Rate Check Every 6 Months

Come on, it’s not really that hard to go online and find out if your rate is still competitive, right? Make it a habit to conduct the proper research and not just blindly signing the renewal notice received from your current insurance company. The internet makes it really easy and convenient to shop for the best rates. Don’t be lazy. If you’d rather not review your policy every six months, you can simply conduct rate checks at major milestones. (i.e. adding a new spouse or teenage driver to your policy, buying a new car, rate increase for existing policy, etc.)

Savings are still savings and it is during these times of uncertainty that you should be researching diligently for ways to reduce your expenses.  Remember that a little bit of patience,as well as a few hours on the Internet can save you hundreds of dollars!


Auto Casualty Insurance

Types of Auto Casualty Insurance You Need to Know About

You may not like it, but vehicular insurance is an essential element of car ownership.  In spite of being extra careful while in the driver’s seat, accidents happen. Sometimes caused by our own doing, sometimes it’s the other guy’s fault…and in today’s litigation-happy society, being at fault in a serious accident can be an extremely costly experience.

Furthermore, state law makes it illegal in most states to drive without car insurance.  Except in New Hampshire and Wisconsin, where it is optional, every driver is required to have liability coverage.

Knowing the basics of auto casualty insurance is the critical first step toward complying with the law, as well as minimizing the unexpected expense of a car accident.

Here’s a summary of basic coverages:

  • Liability Coverage. This element of the auto insurance policy covers property and medical damages caused by a vehicular accident for which you are at fault. Should a victim file a lawsuit, liability coverage comes to your rescue.
  • Collision Coverage. This coverage is optional.  However, if a vehicular accident is deemed to be your fault, collision coverage will pay for the repair of your car.  You contribute a predetermined dollar amount to the repairs (called a deductible), and your insurance company pays the balance. If your car is a total write-off, the insurance company pays you the cash value of your vehicle.
  • Comprehensive Coverage. This coverage is also optional.  This feature covers theft (equivalent to the vehicle’s market value), windshield damage, vandalism and damages caused by flood, fire, falling trees and other hazards due to unfortuitous events (otherwise called “acts of God”).
  • Personal Injury Protection (PIP). Personal injury protection covers medical and disability expenses, as well as loss of income for the driver and passengers regardless of who is at fault.  PIP is mandatory in no-fault states and optional in the others.
  • Uninsured Motorist Protection. This coverage kicks in where your car accident is due to the other driver’s fault and he is uninsured or underinsured.  It covers bodily injury and property damages.

While requirements in very state are somewhat unique, the above basics hold true in nearly every auto insurance situation.  A good local insurance agent will be familiar with the laws of your particular state.  It’s a good idea to seek his advice on the amount of insurance to purchase.

You may also want to ask the agent about their claims handling practices.  Ask questions about how repair estimates are obtained, the time allowed for filing claims and when claims are paid.

It takes a little homework on your part to know the basics of auto casualty insurance.  Your reward, however, is being sufficiently informed to make wise and cost effective decisions.