Making sure you have enough coverage for your car usually involves shopping around for the best plans and rates. New car owners often make some costly mistakes when buying car insurance, and don’t realize that they’ve missed something until it’s too late. If you’re purchasing car insurance for the first time, or you’re seeking out a new insurance provider to purchase a whole new policy, make sure you’re not making one of the most common mistakes during the buying process.
Here are five common mistakes made when buying car insurance:
#1: Buying Only the Minimum to Save Money
Many first-time car owners make the mistake of purchasing only the minimum on their policy just to save some money. While having a very high deductible and selecting only the minimum coverage can help you save in the short run, you could end up having to pay thousands of dollars in repair expenses when you get into a minor accident. Make sure that you’re buying an insurance policy that doesn’t provide only the minimum coverage amounts.
#2: Lying On Your Application
Not providing accurate information about your vehicle, your driving history and the primary purpose of your car is unethical and could catch up with you when you file a claim. Make sure you fill out your car insurance application as accurately and thoroughly as possible, and disclose all details about what you will be using the car for, how many miles you estimate you will be driving each year, and information about your driving history.
#3: Forgetting About Your Credit Rating
Most car insurance providers will pull your credit report as part of the application process. Make sure you’re not taking out any loans or applying for a series of credit cards shortly before you file your insurance application. A drop in your credit score could affect your rate quote.
#4: Insuring Your Car and Home Separately
If your homeowner’s insurance provider also offers car insurance, consider requesting a quote with that company before you start shopping around. More often than not, you’ll find that you qualify for a discount on a package that includes both a homeowner’s and auto insurance policy.
#5: Ignoring Reviews and Testimonials
Even though an insurance provider might offer a great quote on your insurance package, make sure the deal isn’t too good to be true. Take a few minutes to research the company online and read reviews and testimonials to see if they have a lineup of satisfied — or unhappy — customers. Excellent customer service needs to be an important factor in your buying decision.
Sources:
Fox Business — 5 Mistakes to Avoid When Buying Car Insurance
Avvo — Six Mistakes to Avoid When Buying Car Insurance
Car Buying Strategies — 10 Mistakes to Avoid when Buying Car Insurance