How do I know if I chose the right coverages?

What kinds of car insurance coverage are there?

There are many different kinds of insurance coverage that you can purchase, and you should know what these coverages can do for you before you purchase a policy.

Now, there are five main types of insurance coverage which include:

• Liability
• Collision
• Comprehensive
• Uninsured and underinsured motorist
• Medical coverage or personal injury protection

Liability insurance is very important as it provides financial assistance for other drivers’ medical expenses or for repairs to another driver’s vehicle if you were to cause an accident. It is typically recommended that you set your limits to at least 100/300/100. This way, if an accident were your fault, you would have $100,000 per person, $300,000 per accident, and $100,000 in property damage to give to any injured parties.

Next on the list is collision coverage which would empower you to get financial assistance if your vehicle incurred damage during an accident while comprehensive coverage, on the other hand, would help you be reimbursed for damage caused to your vehicle because of events like hail or theft.

Uninsured and underinsured motorist coverage is typically sold as a package deal; however, you should always verify that when you get free quotes. This coverage helps you bear the cost of an accident if you were struck by a driver who had too little insurance coverage or none at all.

In addition to these main coverage types, you may also have a wide range of additional coverages you could purchase if you wanted to like glass breakage or roadside assistance. These add-ons will vary from company to company though so you should also request at least three to five quotes when you shop online so you can find the best coverage options for you, but how can you recognize if you’ve bought the best coverage for your needs?

How do you choose the right coverage?

When searching for a new car insurance company, don’t choose the right coverage for your budget alone. Examine the coverage that you need and the constraints of your budget. When you use both factors as your guide, you’ll find that this can be a winning combination.

While you shouldn’t be paying exorbitant car insurance rates, choose the right coverage that will serve to protect your financial resources. For example, if you have a lot of assets, it might behoove you to increase your liability coverage so your resources aren’t left in a vulnerable position, which can happen if your liability limits are too low.

You’ll also need to take your car’s age into account when deciding how much coverage you need. If you have a car that is getting older, you may not need to purchase full coverage. It often makes more financial sense to only buy liability coverage if you have a car that is getting older and losing value.

Now that you know what coverages might be the best for you, it’s time to start shopping.

Read more: How much insurance coverage do I need?

How can drivers shop for a new insurance policy?

As long as you have an internet connection, you can shop for a new insurance policy from your smartphone or personal computer at any time of day that is easier for you.

Shopping online for insurance is incredibly efficient but you must remember that every car insurance company has its own underwriting process that produces a unique rate for every applicant so you’ll need to be ready to share some personal details about yourself.

Before you start to shop for quotes, be sure to have the following information ready:

• Your car’s VIN
• Your car’s make and model
• Your driver’s license number
• Your address
• Your full name
• Your age
• Your marital status
• Your gender

But this isn’t all that insurance companies use to calculate your rates. Most insurance companies will run a check on your credit score. Now, these checks are known as “soft hits” because your credit doesn’t drop when such checks occur. Insurance companies will also check your driving history to see if you have any moving violations or have caused any accidents.

If you’re concerned that your driving history could cause your rates to be too high, there’s no need to worry. Most insurance companies offer tools that you can use to reduce the cost of your insurance.

How can drivers lower their insurance rates?

There are quite a few ways you can reduce your insurance rates but one of the easiest is to make sure that you are getting every discount that you deserve. If you’re not sure which discounts may be applicable to you, you can always refer back to this list of common discounts offered by some of the best car insurance companies:

• Low annual mileage
• Good student
• Distant student
• Defensive driver course
• Multi-policy
• Multi-car
• VIN etching
• Anti-theft device

In addition to using discount to obtain cheaper rates, you can also raise your deductibles. When you increase your deductibles, your rates go down. Of course, this may not be a wise choice if you trying to reduce the amount of money you could potentially spend from your own bank account.