Ever ask yourself, what your Auto Insurance even covers!!??

LOS ANGELES - March 30, 2014 - PRLog -- Understanding your Auto Insurance needs

It is important to point out, don’t go out and purchase the minimum amount of insurance coverage just because that is what your state requires. It is highly advised to purchase higher insurance coverage more often than not, so as to avoid any future headaches. Prior to committing to a monthly premium take into consideration how much it would cost you in the likelihood of a severe auto accident involving multiple vehicles, individuals and property. Don’t just focus on the fender bender that you might experience while pulling out of a supermarket. Below are a few guidelines to assist you in selecting the right insurance for you.

Understand Your State’s Insurance Requirements

If you recall, it was mentioned that forty-seven states in the union required at a minimum liability insurance. Liability insurance is what pays for potential property damages caused by you the driver. In other states it is obligatory that you also purchase Personal Injury Protection, more commonly known as (PIP). This type of coverage pays for medical expenses and lost wages in direct cause of an auto accident.

Understand Your Option Types

Auto insurance offers a variety of options, but knowing what type of coverage you will need is the key to saving money and assuring appropriate coverage. There are some other insurance add-ons that should be considered prior to committing to a policy such as:

·         Rental Car in case your car gets damaged in an accident.

·         Extended warranty for parts and labor in case of auto repair.

·         Gap insurance for Leased Vehicles

Auto insurance companies offer their own perks such as road side assistance and towing.

Set aside a Budget

Upon researching the liability limits that pertain to your state and or county and your personal needs, you should be able to comprise a budget. Take into consideration the different types of insurance coverage that you are considering and place them into one policy. The first piece of your insurance policy puzzle will almost always be liability insurance. Take into consideration some drawbacks in utilizing this type of insurance coverage. If you were to injure someone in an accident, that party would be able to hire an attorney and attempt to collect restitution through your personal assets. It is strongly advised to take into account your assets and what you can afford to lose in the event of an accident.

Many insurers feel that acquiring the minimum liability is a gamble. Surprisingly the premium increase for full coverage is not a huge difference, especially for older vehicles. Take into account if you were to be involved in an auto accident. Higher insurance coverage results in the insurance company responding for any damages rather than yourself. Compare and contrast the different types of scenarios and “what if” situations, like if I got in an accident would my insurance cover it? How much would I have to pay out of pocket? The answers to these types of questions will help you determine what type of coverage would suite you best.

Know your Vehicles Replacement Cost

Other types of questions that are worth asking is in reference to your vehicles value. If you were in an auto accident and your vehicle was totaled, would you have the coin to replace it? If the answer to this question is no, you will want to consider comprehensive and collision coverage. This type of coverage is highly dependent on the value of your vehicle. The standard guidelines usually state that if your vehicle is worth less than $2,000.00 it would not be worth purchasing this type of coverage. On the other hand if you own a $55,000.00 car, it would certainly be worth paying the extra $200.00 dollars annually to replace your vehicle if you were to be involved in a serious accident.

The best method in finding the right insurance policy for your individual needs is to examine potential polices and know how much you are will to gamble with. For instance, it might be best to not purchase collision insurance if your car is not incredibly valuable and would therefore cost less to fix than to keep insured. Auto insurance boils down to how much you are will to gamble paying out of pocket versus how much you want the insurance company to cover.

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