7 Sobering Points Regarding Car Insurance Which May Surprise You
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Added: 01-02-12
- 1. "My friend told me that I can use my car at my second job delivering pizzas and that my insurance policy will cover an accident."
Motorists have seen a record 40% hike in premiums over the past year, with the average annual comprehensive policy forecast to break the 1,000 barrier within the next 12 months. Car insurance companies say a major reason for this increase is fraudulent claims that are estimated to cost 2.7bn a year, adding 44 to the annual premium of honest motorists.
2. Gender - women usually drive safer compared to most men. Even so, with more and more women getting hold of the steering wheel, these facts are beginning to change.
There is no such thing as Full Coverage, meaning that everything is covered. Your car insurance policy is very specific about the limits and coverage afforded, there is no insurance policy that will cover everything. So if your lap top is stolen from your car, a claim must be filed through your Renters insurance or Homeowners insurance policy and you will have to pay the deductible.
3. "I got a ticket and my insurance premium will probably triple!"
In response, the Association of British Insurers has said it welcomes the chance to discuss what needs to be done to ensure people in Bradford get the very best possible motor insurance deal. Unfortunately, it appears that most feel that the reason there are so many uninsured drivers in the area is of course due to the obscene
2. Driving Violations - the more tickets you have under your vehicle dash, the higher insurance premiums you need to pay. Whenever you apply for a car insurance premium, your insurer would penalize you for your bad driving history but do not worry too much. Since you improve your driving history as time passes, your insurance rate is very likely to get cheaper also.
The cost of your car insurance policy is based on your age, sex, zip code, driving history, coverage type, make, model, engine size, the car's safety record and the likelihood of it being stolen.
4. Accident Claims - certainly, when you have more car accident claims under your belt, then you're more likely to pay higher insurance compared to those who've clean records.
Some insurance companies take a drivers' credit history into account when configuring the car insurance quote. If you have a low credit score, it is more likely that you will car insurance rates stop making payments on your insurance. However, once your credit score is factored in, most people end up with a lower rate
Last but not least, keep a box of tissues handy in your car to prevent a runny nose. You never know who might be parked by your side at the next set of traffic lights!
Each state has set the required minimum level of insurance coverage, here in California it is $15,000 per person injured, a maximum of $30,000 per accident and $5,000 property damage liability. These limits are very low. Emergency medical car insurance rates services are very expensive and $5,000 worth of damage can be exhausted in a very minor fender bender between two relatively new vehicles. It is a serious mistake to maintain these low coverage levels. You could face a serious financial collapse if you find yourself paying out for medical bills and property damage as a result of being under-insured. Being under-insured could make you vulnerable if another driver decides to sue after an accident.
7. "Insurance companies make car insurance rates up their prices and charge whatever they want."
Insurance companies are required to describe how the rates are calculated and then the rates must be filed for review and for approval or rejection. Any increases or decreases must be filed through the state of California department of Insurance for a review and then the rate is accepted or rejected.
8. "My insurance covers any car I drive."
Some insurance polices, called broad coverage policies, transfer coverage to a vehicle that is made available to you on an incidental basis. Every policy is different. Some companies only transfer the minimum state liability requirements while others are a true broad coverage policy that transfers your specific liability limits. However, many insurance policies are restricted policies or named-operator insurance policies that only cover the named drivers, everyone else is automatically excluded and coverage is not afforded.
9. "If my car is stolen, my insurance company will pay off the loan."
If you bought GAP Insurance when you bought your vehicle, this is true. However, if you have comprehensive insurance and your car is stolen or totaled in an accident, the insurance company will establish the fair market value of your pre-accident vehicle and pay you the actual cash value. This estimation excludes finance charges, interest rates, licensing fees, taxes and other charges you may have accrued throughout the lifetime of your loan.
10. "My insurance company will pay for my car rental."
Your insurance company will not pay for your car rental unless you have purchased car rental expense. This coverage is typically sold only in conjunction with comprehensive and collision coverage.
It is important to read and understand your insurance policy. It is also important to ask questions and address your concerns to your agent.
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