March 10, 2010

4 Things To Know Before Buying Your First Auto Insurance Policy

The purchase of one’s first car is a milestone event. Likely, the car has seen better days and could use at least a tune up, if not a full overhaul, but that makes it no less exciting. Along with first-time car ownership, however, comes another first – car insurance. For many first-time auto insurance buyers, knowing what kind of policy to buy is overwhelming. With so many insurance companies now offering online and instant car insurance quotes, finding a quote is easy – but finding the right one can be a challenge. Here are four things to bear in mind before purchasing any insurance policy.

First, remember that your age and the type of car you drive will significantly factor in to the price of your auto insurance quote. A driver who has thirty years of experience on the road will receive a much better rate than one who has only been driving for five years. Experience, and a lack of accidents, count. As well, a sports car or motorbike will cost more to insure because those types of vehicles have a higher likelihood of being involved in a collision, which means a higher chance that the insurance company will have to pay out. Initially, your auto insurance quotes will largely be based on these two factors.

Secondly, understand that every insurance provider operates differently. This can be because they are from different states or specialize in different types of insurance. This can be of benefit to the consumer, as one insurance company may offer a discount for bundled services such as second car or apartment insurance. Third, be very clear when purchasing any car insurance policy; look at exactly what the minimum deductible is and if you can increase it. A deductible is the amount payable by the customer before the insurance company will begin paying out for any damages. The higher the deductible, the lower the premiums on the policy will be.

Fourth, be sure you understand exactly what types of insurance you are purchasing. Not all states require vehicles to carry collision insurance, and providers from those states will likely not include it in their base price. Ask if the policy includes things like underinsured or uninsured motorist coverage, which will payout in the event you are in a collision with someone who does not have an adequate amount of auto insurance to cover your damages. For a first-time buyer, sifting through all of the available car insurance quotes can be time consuming. But with a little research and by taking the time to carefully review your options before making a purchase, you can be sure you’ve found the right auto insurance for your needs.