After my car was broadsided, I knew that there had to be something I could do to save a little time and money. I was nervous about paying to fix the car myself, so I started looking into my auto insurance policy to see if they could help. They were really kind and generous, and before I knew it my car was in thee shop getting fixed. I wanted to start this blog all about choosing a better auto insurance plan to improve your life. Check out this information to see what you might be able to do to make things right.
Purchasing insurance is a good way to protect yourself when dealing with anything you value, such as an automobile. There are, however, a lot of misconceptions regarding what insurance is actually about and how folks can benefit from having it. Let's take a look at what you should know before you sign up for your next insurance policy.
Insurance Isn't Just About Replacing Stuff
The main introduction to insurance that many people get is when they purchase their first car in their teens or 20s. At that age, it's easy to understand why the concept of insurance is only about replacing the vehicle. Young folks are often worried about losing the only daily driver they have, and in many cases, they simply don't have the cash on hand to replace the vehicle if something catastrophic happens.
Insurance, though, is about mitigating risk. Yes, there's the risk that you'll lose your ride. However, there's also the risk that you'll be found at fault for hurting or killing another person in an accident. If you're worried about finding the money to replace the several thousand dollars you have tied up in a used car, just wait until you hear the numbers that get thrown around in catastrophic auto accident cases.
Premiums Are About Balancing Risk
When you think about the premium you'll need to pay for insurance, the balancing act involved is ultimately about how much risk exposure can you afford versus how much of a premium can you pay. This leads to two of the biggest mistakes people make regarding insurance.
First, many folks carry too much insurance because they don't understand the policies. In many cases, they simply tell their agent to give them the amount of coverage that protects them against every possibility. This may simplify the decision-making process, but you might benefit from taking the time to learn about the distinctions between, say, comprehensive and collision coverage.
Then there's the second group of people, the folks who carry too little insurance. If you have a single car that you absolutely rely on to get between home and work, for example, you can't afford for that car to go poof. It's common, though, for drivers to dismiss insurance as a scam, especially in states that have minimum coverage imposed by the government. What happens, though, if you end up at fault in a one-car accident and are not covered?