How To Choose The Right Car Insurance Policy

by Justin Weinger on July 9, 2013

Car insurance – you have a love-hate relationship with it. You buy it but pray that you will never need to use it. You may pray all you want, but if there is an accident, then the insurance will keep your finances secure.

Oops! That collision was not your fault. But, the other driver is not insured. So, what do you do now? Not to worry! This is why you have auto insurance. The extent to which the car insurance can help you depends on the package you choose.

You have to remember that there is no package that will cover everything and choosing the right car insurance policy won’t be an easy task. You have to avoid overpaying and still get the right policy.

Given below are the factors that you must consider when choosing the right coverage for your car:

1. Personal Liability– Your family’s safety is the most important factor. Therefore, give prime importance to personal liability when choosing the insurance policy. When an accident occurs, the medical facility will first request for your health insurance. Even if you don’t have health insurance, you must have a good coverage that pays for all medical expenses in case of an accident.

2. Uninsured Drivers – A study conducted by Insurance Research Council shows that the faulty driver in one in seven accidents is uninsured. Don’t take it for granted that everyone will be as responsible as you. If the other driver is uninsured and does not have a good policy, then you will be left holding the bills. Although it is hard to digest that you will have to pay for the other driver’s mistake, it is worth all the premium and deductibles. At least, you won’t lose your vehicle.

3. Major Accidents – Major accidents do occur, in spite of all the care you take. Consider this factor when you are buying insurance. Your car may be involved in a major accident and may be totaled. What will you do then? The insurance will protect you and pay for your car. There may be natural calamities that may result in car replacement or repair. It is better to have an adequate coverage so that you don’t suffer financial losses.

4. Getting Stranded – Your car may break down suddenly and require towing. It is just a machine, and it can breakdown any time. Be prepared for such an event and ask the car insurance agency to add rental and towing coverage to your policy.

5. Age and Condition of Your Car – If your car is new, then it will be in a good condition. You can minimize the towing coverage. But, even a new car can be involved in accidents and repair or part replacement will be expensive. Consider this and ensure that the insurance covers this aspect.

In case of an old vehicle, you will need a better towing coverage. Rental coverage is also essential, so that you can get to work when your car is under repair. Or, if the rental car is damaged because of your fault, the insurance can pay for it.

6. Driving Experience – Your insurance will also depend on how good a driver you are and the kind of driver you have at home. If you have a teenage driver, then have good personal liability insurance, as teen drivers make more mistakes. They lack driving experience and hence, the insurance coverage will be more.

Overall, you have to learn about premium and deductible. Premium and deductible share an inversely proportional relationship. If one goes up, the other goes down. You have to decide whether it is the premium you would like to pay more or the deductible.

Talk to the insurance agent about both and choose wisely. But, don’t overpay. To know more about car insurance policies, you can visit




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