Getting auto insurance can be complicated and daunting. There are a lot of things to consider, including how much coverage you actually need and how much you can afford.
If insurance and personal finance aren’t your strong suit, it may be best to talk to a financial adviser who can evaluate your cash flow and ability to make payments. However, this article will give you some basic things you should think about when you’re in the market for auto insurance.
What Are Your State’s Minimum Insurance Requirements?
Every state has its own basic requirements for auto insurance. If you’re a new car owner and have no idea about what’s considered essential in auto insurance, looking up your state requirements is the best place to start.
How Often Do You Use Your Car?
Car usage is a big factor in deciding what kind of auto insurance coverage will best suit you. How frequently you use your car and how many miles you drive per day will have implications on which policy will give you the best bang for your buck.
How often you drive can also be a major factor when considering your risk of being in a traffic accident. Getting good auto insurance coverage becomes increasingly important the more you use your car.
What Kind Of Car Do You Drive?
Certain types of cars are more likely to have higher premiums due. A sports car, for example, will require more substantial coverage because it’s at a higher risk of being stolen. Plus, in the event of a car accident, repairing a sports car or having some parts replaced will cost more than a regular sedan. If you have an expensive car model, it would make more sense to get higher insurance coverage.
Who Drives Your Car?
Driver’s experience matters in determining the coverage you need. If you’re an experienced driver with a clean record, you may not need much more beyond standard coverage.
However, if other people in your family drive your car, you must take their driver’s experience into account as well. If one of your family members is relatively inexperienced or has previous traffic violations, they have a higher risk of making mistakes on the road and being involved in an accident. In this case, you will want to get a more substantial insurance policy that also covers other drivers apart from yourself.
What Can I Afford?
Making insurance payments is no small matter. You will need to give some thought to your personal expenses and monthly budget. Then, consider the minimum and maximum amount you can put towards premium payments. Once you know your range, you can communicate your budget limit to your insurance agent.
Some agents may want to upsell additional coverage that they think you would need. While getting the most comprehensive car coverage available would be nice, you have to remain grounded in what you can realistically afford.
Being firm and transparent about your budget constraints can help your agent figure out how to adjust your coverage accordingly. A good insurance agent should be able to propose plans that balance your auto insurance needs with what you can afford.
If you need further guidance on auto insurance coverage, contact the Panorama team for their expert advice.