Auto Insurance

Car Insurance Tips

With the advent of the internet, it's even easier to save money on your car insurance. An online car insurance quote is not only a great source of information but can be a great money saving tool.Online quotes also allow the convenience of comparing insurance costs from the comfort of home.

You can save hundreds of dollars per year by shopping online for car insurance but make sure you are comparing apples to apples.

Car insurance can be a tough thing to compare, as most shoppers are not familiar with all the features of a typical car insurance policy. As always there is some urban legend, and just plain wrong advice floating about the internet about car insurance. Let's first take a look at what goes into a comprehensive insurance policy, then we can start searching for the best deal online.

Premium: Let's start off with an easy one, since we need to warm up the old noggin before we tackle some of the more complex parts of your car insurance policy. The premium is the amount you pay for your car insurance policy. (I told you we were going to start off easy) But, there is a catch here to watch out for! If you pay monthly, you may be paying more for your car insurance. Most companies will offer a discount for yearly payments, or charge a paperwork fee for monthly billing. No matter what you call it, you end up paying more if you pay monthly.

Now depending on your economic circumstances, or your vehicle being insured, you may not be able to pay an entire year up front. In this case, ask if you can get a discount for automatic monthly withdrawls from your bank account. If you can't live with this option, then all you can do is live with the extra fee (if charged) and make sure you figure in this extra expense when comparing policies.

Collision vs. Comprehensive

Knowing your terminology can help you save a ton of money when shopping for car insurance. Today we bring you an article about the difference between Collision and Comprehensive coverage.

In the world of automobile insurance, two types of coverage, collision and comprehensive auto insurance, are often confused, or mistaken for each other. While both include coverage limits and deductibles, there are major differences in what each type of policy really covers.

Collision:

Collision insurance covers you if your car or truck is in a traffic accident – if you crash into another car, or into something like a light pole. An easy way to remember this is that collision insurance protects you if you collide with something.

Your collision policy will pay out when you are at fault in an auto accident, but if someone else is at fault, it is their responsibility to fix or replace your vehicle. Most of the time, the other driver's liability insurance will cover such expenses, but if not you probably have un- or under-insured motorist insurance as part of your total package, and that will kick in.

Remember that if your automobile is leased or financed, and you are in an accident, the insurance company will pay the holder of your lease or note, not you. If your car is very new, it is possible that such a payout will not equal the amount of the loan or lease, which is why – with leases especially – it is recommended that you have gap insurance coverage in addition to collision coverage. Gap insurance is extra coverage that pays the difference between your collision coverage and the amount of your loan or lease.

Comprehensive:

Some people refer to comprehensive coverage as "other than collision insurance," because it offers protection for damages caused by things other than traffic accidents, including fire, theft, natural disasters, vandalism, acts of God, and impacts with animals (if you hit a deer, comprehensive insurance covers it; collision does not.)

As with collision insurance, payouts on comprehensive insurance claims are only up to the fair market value of your vehicle. Gap insurance can be useful in times when a new car is stolen or damaged.

Deductibles and Premiums:

Comprehensive and Collision policies both have deductibles and premiums. The deductible is the amount of money you pay out of pocket before the coverage kicks in, when you make a claim. The premium is the annual (or semi-annual) amount of money you pay to obtain and retain coverage.

You do have some choice about the amount of your deductible, and the amount you choose will affect what you pay in premiums. If you have significant savings, and can weather a financial storm, you may want to choose a higher deductible and keep your premium low. On the other hand, a lower deductible will make your premium higher, but in the event of a claim, you won't have to pay as much out of pocket

Which Type of Coverage Do I Need?

When it comes to insurance for car the type of coverage that is best for you, one of the major factors is the age of your car. For very new cars, especially those that are financed or leased, it's probably wisest to have both types of coverage, and, in fact, most lenders will require this "full coverage."

For older cars, you may wish to drop some of your coverage in order to save money, but you should check with your insurance agent before making such a decision.