Five Important Insurance Questions

With so many auto insurance companies claiming to be the best, it’s difficult to know which one to choose. Here are five important questions to ask before signing on with any car insurance company.

1) What type of coverage do I need?

There are four big ones to ask about.

• Personal coverage: This includes medical coverage and compensation of lost wages for the policyholder and his or her passengers.
• Collision coverage: This coverage will pay for the repair or replacement of your vehicle in case of an accident.
• Comprehensive coverage: This includes coverage in case of a natural disaster or theft.
• Uninsured motorist coverage: This coverage will help if you’re in an accident with someone who is uninsured. If they are uninsured or do not have enough coverage to pay for you, this insurance coverage will pay for your repairs. Also included in this coverage is a hit and run.

2) What discounts are available?

With any insurance company, there will be discounts available. They probably won’t be offered up front. You’ll need to ask. Discount factors range from the year of the car to your driving history to whether or not the car has daytime running lights. Also, if you have any children in college, many companies offer a good college student discount. You’ll have to provide a copy of their grades. Basically, if you’re looking for the best deal available, be sure to ask about everything.

3) What’s the minimum coverage necessary in my state?

http://personalinsure.about.com/cs/vehicleratings/a/blautominimum.htm

Each state is different and each insurance company will offer you more than necessary. The minimum coverage for your state can be found here. The requirements are set up like ##/##/##. The first two sets of numbers refer to the bodily injury liability limits. The third refers to the property damage liability limit necessary.

For example, Florida’s minimum coverage is 10/20/10. This means that each person injured in an accident would receive a maximum of $10,000 with only $20,000 allowed per accident. The last number refers to the total coverage available for the total amount of property damage.

4) What’s the most coverage I can afford?

This is a simple one but still something very important to consider. Just because your state has a set minimum, that doesn’t mean that it’s the best option. Before deciding on auto insurance, sit down and check your finances to see how much you can comfortably afford. You will obviously need the set minimum. In the event of an accident, if your fees exceed your coverage, there’s a chance that you can be sued for the remainder.

Another important aspect of this is to consider what type of deductible you can afford. Everyone hopes to never have to pay a deductible, but the truth is that you may have to one day. Be sure to check if you have a sliding-rate deductible or a set rate.

5) What does each policy include?

After deciding on what price range you’re comfortable with, you can now go through and decide on your policy. Be sure to ask about what everything includes. If you’ve followed these steps, you should know what type of coverage you need and what type of coverage you want.

Depending on your what you’re comfortable with, you may want to check on aspects like roadside assistance and whether you will receive a free loaner car in case of an accident.