What To Consider If You Want the Best Car Insurance
Let’s agree on one thing : everyone needs car insurance these days.
Whether you’re a new driver or a tenured one, you always need some preventive measures for unforeseen circumstances. Getting car insurance is considered a mandatory practice especially in the United States.
By definition, auto insurance is a contract or agreement between the car-owner and the insurance company in case any accident should happen.
Now, you often ask yourself this question: What is the best car insurance for me?
Of course, you do need to consider a few factors.
The Type of Car Insurance
When you consider the best car insurance, its does vary depending on the needs of the individual driver.
Liability coverage is the must-have coverage or minimum legal requirement for insurance. This includes bodily injuries and property damage. However, it will only cover up to your coverage limit. In a nut-shell, the insurance company will only cover the party involved and you need to shoulder the costs of your damages whether injuries or vehicle repairs.
The Insurance Company will cover repair costs if you have an accident with another vehicle or cause a collision with no motorists involved. If your car is totaled,insurance companies usually cover the current value of your car.
You need to pay for the deductible or out of pocket expenses after your claim payment.
Comprehensive damages are other accidents not caused by a collision. Damages for vandalism, theft, certain falling objects, fires or explosions, and ‘Acts of God’ like hail, hurricanes and other weather events.
Comprehensive coverage is an extra measure in case anything does happen to your vehicle.
You also need to pay for a deductible.
Uninsured Motorist Insurance/Uninsured Motorist Insurance
In most cases, these two go hand in hand and some states do require this type of insurance.
This should cover bodily injury and/or property damages when the accident is caused by an uninsured driver.
Underinsured means that the driver has some type of insurance, but not enough to cover the damages done to the party involved.
Medical Payments Insurance
This may be beneficial for someone who does not have health insurance, but on the contrary, even if you do have health insurance, there are some medical expenses that might not be covered. If you have this type of insurance, it will be considered as your primary insurance in a particular event.
Medical Payments Insurance covers you and the passengers involved in the auto accident. Some medical payments insurance even extend to riding in another person’s vehicle or as a pedestrian (who was hit by a car).
Personal Injury Protection Insurance (PIP)
Regardless who is at fault of the accident, PIP may cover some medical expenses of the policy holder. There are coverage limits, depending on your insurance provider.
The difference between PIP and medical payments is that PIP covers beyond medical expenses like loss of wages, rehabilitation, and even funeral costs.
With PIP, there is no assessment for who is at fault of the accident.
Since cars tend to depreciate rather quickly, gap insurance may help cover the costs if you were still paying loan payments during the time of the covered accident.
Towing and Labor Insurance
This usually is included with some insurance coverages, but this will cover any costs for towing and labor.
Rental Reimbursement Insurance
If your car was damaged beyond repair and you need to use a vehicle, the insurance company will reimburse your rental expenses if you have this type of insurance.
Classic Car Insurance
In some cases, insurance companies also have specialized coverage for vintage cars and car collectors.
For most insurance companies, full coverage includes: liability, collision, comprehensive, and PIP/medpay. Full coverage insurance does cost a bit more than basic coverage.
Every insurance company has different policies so if you already have an insurance company, be sure to contact them before making any decisions on the type of insurance that you should have.
Each state does have a minimum coverage limit required by law and you would need to do your research to what type of insurance that you need in your respective states.
According to NerdWallet, the national average for insurance is about $1,621 per year in 2019 (NerdWallet Rate Analysis)
Top 3 most expensive states (full- coverage):
Michigan: $4,079 per year
Louisiana: $3,678 per year
New York: $2,647 per year
Top 3 most expensive states (minimum required coverage):
Michigan: $2,508 per year
New York: $1,448 per year
New Jersey: $1,279 per year
Top 3 cheapest states (full- coverage):
Maine: $897 per year
North Carolina: $978 per year
Idaho: $990 per year
Top 3 cheapest states (minimum required coverage):
Wyoming: $1,128 per year
Iowa: $325 per year
South Dakota: $326 per year
Previous Traffic Violations or Accidents
Insurance companies do consider these factors as high risk, but it does vary by company and state how far back insurance companies go when looking at your driving record.
On average, an insurance company won’t look into an accident past 3 years, but in some cases such as a DUI (driving under the influence), that can stay on your record for up to 10 years.
Again insurance premiums vary with each company and state.
The best thing to do is have a clean driving record and avoid having accidents.
Is Age Really Just A Number?
In the case of your auto insurance, the younger you are, the higher your average rate will be.
People who are just starting out such as teenagers who just recently passed their driver’s license exams are considered ‘high risk’ due lack of experience. The older you get, the lower your insurance rate will be— assuming that you don’t have any accidents and you have an excellent driving record.
People under the age of 18 can pay as much as $7,000 on their annual premium. If teenagers want to save money on car insurance they need to consider things like student discounts, taking drivers’ education, paying the annual premium in full, low mileage, or even putting yourself under your parents’ policy.
Everyone wants the best car insurance, but with those premium rates for young drivers, you might want to scout and look around for the best insurance rates.
Battle of the Sexes
The sad truth is gender-based pricing does happen – 44 states can still use this factor to determine insurance rates.
Based on a car insurance rate analysis done by The Zebra in March 2019, women actually pay more for car insurance than men.
In a span of two years, findings show that there was a significant increase in insurance rates for women versus men. Nevada was example that was shown wherein women paid $14 more than men on car insurance. However, this jumped to a whopping $121 more in 2018.
Below shows who paid more in which states (2018):
Source: The Zebra
While gender based factors are highly debatable at this day and age, there are a few states such as California who are banning this gender-based car insurance pricing.
New Vehicles Vs Used Vehicles
You guessed it. The price of the insurance premium will depend on the year, make, and model of the vehicle.
According to NerdWallet’s analysis in 2019, the top 10 least expensive cars to insure are:
- Subaru Outback.
- Jeep Wrangler.
- Honda CR-V.
- Jeep Compass.
- Ford Escape.
- Subaru Forester.
- Chevrolet Equinox.
- GMC Sierra 1500.
- Toyota Tacoma.
- Jeep Cherokee.
Sure, we all want the best car insurance, but insurance companies also take precautions based on the cars that you have. Expect to have high premiums if you own luxury, sports, or even electric cars.
Here at Manuel’s Body Shop in Culver City, California, we offer different types of services with financing options and we will personally talk to your insurance company. We hope you find the best car insurance in California. Be sure to drop by the best body shop in Culver for any maintenance or repairs.