As a first-time buyer, it can be hard to choose the best auto insurance. Today, every insurance company says it's the best, so it's easy to get confused. To select a plan that fits your budget and car needs, you need to know how the process works. With this guide, you’ll be able to choose the perfect auto insurance provider in no time.
Understanding Auto Insurance
Auto insurance is the contract between you and your chosen insurance company. This contract states that you will be financially protected if you are a victim of an accident or theft. In return for this financial protection, insurance companies charge a premium that you pay. Most states, including New York, require auto insurance at a basic level.
Auto insurance policies often cover medical and property expenses. Yet, only some policies cover the amount in full. The amount you pay for auto insurance and what you pay out of pocket for these incidents varies based on personal information and what you need and want.
Types of Auto Coverage
This is where the process can start to feel overwhelming. There are many types of auto coverage. Forms of coverage can range from being required in states to entirely optional.
Most states, including New York, require car owners to have liability insurance. This insurance includes bodily injury liability insurance, which covers the costs associated with physical injuries, and property damage liability insurance, which covers the costs associated with property damages. Both of these coverages only pay for the damages you cause others.
Personal injury protection (PIP) and uninsured motorist coverage and required in some locations. PIP covers you and your passenger's medical expenses and lost wages, regardless of fault. Uninsured motorist coverage is a reimbursement if you are in a hit-and-run or the other driver does not have insurance.
Though not required by law, many people add collision and comprehensive coverage to their policies. Collision coverage is what it sounds like - if you collide with another car or object, regardless of fault, insurance will cover your car’s damages. Comprehensive coverage protects you against theft or any damage caused by factors other than a collision that are out of your control.
You may consider other coverages, including gap insurance, rental reimbursement insurance, and towing and labor insurance. Find out more about these and other optional coverages on Nation Wide.
Choosing Auto Insurance
After a basic understanding of what types of coverages you need and others you might want to consider, the time comes to find an insurance company that checks all of these boxes while staying within your budget.
The first step is to find insurance companies that offer the coverage that you need. If an insurance company does not provide coverage for a specific policy that your location requires… it’s off the list.
After finding out who will give you what you need, it’s time to discover companies that also offer what you want. Research insurance companies that provide those more niche coverages that interest you. This process should slim down your list.
Get quotes. This is probably the most intimidating part of the process, but it becomes easy with online comparison tools to help along the way.
The most important aspect of comparing quotes is to ensure that you add the same coverage and policy to each section and quote to get a perfect side-by-side comparison.
Online comparison tools like The Zebra allow you to compare multiple insurance companies in one spot, which means less work for you, and clearer, more direct information.
After narrowing down your list to a couple of companies that have what you want and what you need and stay within your budget, the final decision is determining a deductible.
A car insurance deductible is an amount you agree to pay out of pocket after a covered loss before your coverage kicks in.
If you decide on a higher deductible, you lower your premiums, but you will pay more out of pocket in the case of an accident. If you decide on a lower deductible, you raise your premiums, but you will pay less out of pocket in the case of an accident.
When choosing a deductible, see how different prices will change your overall premium and determine what you can afford.
After this, you’re ready to make your decision!
Ready, Set, Drive!
Although choosing car insurance can seem like a dreadful thought, with the right tools and guidance, it doesn’t have to be stressful.
Understanding the basics of auto insurance and the types of coverage will give you the tools to find policies that are right for you. With the help of online quote comparison sites, the financial decision is as easy as ever. In no time, you will be able to find your perfect match in the world of auto insurance.