|
THE SEVEN DEADLY SINS OF CAR
INSURNACE:
By John Sentena
SENTENA & ASSOCIATES
7 SIN’S CAR INSURANCE BUYER MAKE
o you’re shopping around for auto insurance. What do you need to know? Well,
there are lots of ways – at least 7– that you can save money. Many of these moneysaving
ideas may apply to you.
1. You Insurer Your Home With A Different Agent – Do you have a homeowners or
renters insurance policy? If so, is it with the same insurance company that provides
your auto insurance? If the answer is no, you’re paying too much – for both policies.
Almost every insurance company that sells auto insurance wants its policyholders to
also buy homeowners or renters insurance from that company.
These insurers offer so-called multi-policy discounts. Usually, these discounts are at
least 10% and some insurers apply the discounts to both the auto and the
homeowners/renters policy.
* Tip. Talk to your agent about multi-policy discounts.2. Your Driving Record Has Improved – It’s no secret that the better your driving
record, the less you will pay for auto insurance. But did you know that most people
qualify as “good drivers” and are eligible for discounted premiums? Some good drivers
pay a lot more than others, however.
Many auto insurers are actually a collection of several insurance companies in which
each caters to a certain type of driver. The worst drivers go in one company, the best in
another, and a lot of people wind up in one of the middle companies.
These middle people pay less than the worst drivers, but more than the best. The thing
is, many of these middle people have driving records that are just as good as those who
are insured by the companies that offer the lowest rates. Yet these middle people are
paying more. Why?
The usual reason is that they don’t know any better. No one told them which insurance
company in the group had the best prices. And, probably, no one told them there was
even a group of insurance companies. If you have a spotless driving record, there’s no
reason you shouldn’t be paying the lowest price a group of insurance companies has to
offer .
* Tip. Make sure you’re getting the best discount for your
current driving record. Talk to your agent. And remember, be a
safe driver. It will save you money.
3. High-Profile, High-Cost – The type of car you drive is a major factor in what you payfor insurance. Is your vehicle a magnet for thieves? Is it more expensive to repair than
most cars? If the answer to either of the last two questions is yes, you’re paying more
than the average car owner for insurance.
* Note. To get detailed information on your vehicle(s) – or a vehicle you’re thinking
of buying – write to the Insurance Institute for Highway Safety at 1005 North Glebe
Rd., Arlington, VA 22201 and ask for the “Highway Loss Data Chart.”
4. Your Deductible Is Too Low: The deductible is the amount you pay before insurance
kicks in if you have a claim. For example, if you have a $250 deductible and you have
an accident in which your car sustains $1,000 in damage, you pay the first $250 and
your insurer pays the balance, $750. The lower the deductible you choose, the more
you pay. If you have assets, you can probably afford to absorb at least $250 and
probably $500 if you have a claim.
* Tip. If it’s been years since you’ve had an accident, you may be better off raising
your deductible and paying less each year for insurance .
5. You’ve Got Coverages You Don’t Need – Let’s say you have an older car, one not
worth very much. There’s really little point in having collision and comprehensive
coverages. You don’t have much to protect. Remember, too, that you have to subtract
your deductible from any potential payout you might get.
* Tip. As a general rule, any car worth less than $1,000 shouldn’t have collision andcomprehensive coverage. Between the deductible and the extra expense of these
coverages, the cost is probably greater than the benefit. How much is your car worth?
An auto dealer can tell you, or there are plenty of books that have values of vehicles
going back many, many years.
6. Are You Getting The Discounts You Deserve – Auto insurance companies offer
several discounts for a variety of reasons. The car has automatic seat beats, air bags,
anti-lock brakes, anti-theft devices, etc. The driver is a good student, which is
especially valuable if you have teenage children who will be on your policy.
* Tip. Make sure you are taking advantage of all the discounts available to you!7. Credit Where Is (Or Is Not) Due – Is your credit record better than your driving
record? If you have a good credit record, you could be eligible for discounted
premiums from several auto insurance companies.
* Fact. Many insurers now use your credit history as a major factor in determining
what to charge you for auto insurance. In some cases, with some companies, you could
save money by shifting your business to an insurer that uses credit as a rating factor –
even if you have a so-so or poor driving record. There is another side to this coin. If
you have a poor credit history, you could save money by moving your auto insurance
to a company that does not use credit as a rating factor. Most insurers do not look at
your credit report at your renewal if your credit has improved since you purchased the
policy you could be eligible for the cheaper rate.
* Tip. Regardless of your credit status, you should talk to your agent to make sure
you have the best situation given your credit record, good or bad.
Whatever your driving record or coverage needs, you should shop around, or let an
experienced insurance professional shop around, for the best deal for you. There are
literally thousands and thousands of coverage options from hundreds and hundreds of
insurance companies.
In addition, not only should you try to get the best deal you can, you also need to make
sure you have all the coverage you want/need. Using an Independent Insurance Agent is
usually your best bet to get the most value for your auto insurance dollar.
At Sentena & Associates, we take a personal interest in our customers. We
like to share information that comes to help you protect yourself and your
family from financial loss. If you have any questions, regarding this
information or your insurance coverage, please contact us at 303-693-9343 or
email info@dci-ins.com.
|