4 Common Mistakes People Make When Shopping for Car Insurance

4 Common Mistakes People Make When Shopping for Car Insurance

Shopping for insurance is not something you should rush. We understand that you may be eager to drive your brand-new car, but if budget is important to you, you have to ensure that you get the best deal possible. You also have to be confident that your insurer will be there when you need them and offer the type of coverage you need. So let’s take a look at some of the mistakes you should avoid when shopping for car insurance.

Picking the First Insurer You Come Across

Many people will pick an insurance company because someone recommended it to them. Or they will go with the most prominent name that they can remember. But these are all very bad ways to pick an insurer. Most insurance companies are roughly the same at their core, so you don’t need to go with the biggest, most well-known brand to get good coverage. Plenty of lesser-known companies will give you great service and much better car insurance quotes. So, don’t be afraid to shop around for online car insurance quotes and compare coverage.

Choosing a Deductible That is Too High or Too Low

The next issue is with deductibles. Many car owners don’t understand how to pick the right deductible and will either go too high or too low. Some people will set their deductible very high so they can save on insurance, but that only works if you have an expensive vehicle in the first place and want to bring your premiums down. There is no point in setting a deductible that would be a third of a car’s value. So, if you own a budget vehicle, it’s often better to go for a low deductible.

Taking Minimum State Mandated Coverage

Another mistake people make is taking the minimum amount of coverage mandated by law. For example, suppose your state requires that you have $5000 minimum liability coverage and $20,000 on property damage and cause an accident over that. In that case, you will have to cover the rest of the damages out of your own pocket. This could be disastrous if you’re involved in a big accident or cause damage to expensive public property.

Not Doing Everything You Can to Save

You need to know everything you can do to save money on your insurance and consider all options. For example, some companies will cut your premiums if you let them monitor you or if you install an anti-theft system on your vehicle. Others will cut costs if you enroll in a defensive driving program, for instance. These would all be straightforward things to do, but they could cut your premiums significantly. So, learn which special programs the insurance company has available and do whatever you feel is reasonable to lower your costs.

Shopping for insurance is something you should not take lightly since it could have significant consequences on your financial future. So take the time to look at as many insurers as you can and learn what constitutes good coverage before you even start shopping.

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