by Larry Carley c2008
Auto insurance is something every motorist must have. It's the law in most states, and the fine if you are caught driving without insurance is usually as much if not more than what the premiums would have cost you to buy insurance, at least for a driver with a good driving record.
Years ago, when I was a journalism student in college I wrote a freelance article for the Des Moines Register. The article was about shopping for auto insurance. I created four hypothetical drivers (different ages, married & single, all with good driving records), and then called a list of insurance companies for a rate quote. I asked for identical coverage (same liability, collision and comprehensive coverage) so I'd be sure I was comparing apples to apples, and not lemons. All this was long before Al Gore invented the internet, so it took quite a bit of time.
The quotes I received varied by hundreds of dollars for the exact same coverage. In fact, some companies charge almost twice as much as their competitors!
My article stirred up quite a bit of controversy at the time, and really opened people's eyes to the range in rates they might be quoted when shopping around for car insurance.
COMPARING RATES ONLINE
Today, shopping for car insurance is so much easier and faster thanks to online insurance rate comparison services. All you do is enter some basic information such as the year/make/model of the vehicle you wish to insure, how many miles a year you drive, what the vehicle is used for, and personal information about yourself such as age, marital status, driving record, employment, etc.). Then you choose the kind of insurance coverage you want from a menu of options. Then you fill in your name, address, phone number and email address, and any other information that an insurer may request. It takes about 10 minutes or less to fill out the online forms. Your quote then comes via email (usually within 24 hours or less).
What could be easier? It's virtually painless, and you are under no obligation to accept any of the quotes. Better yet, no insurance salesman will call you and hound you to buy their insurance.
WHAT YOU NEED
Liability coverage covers any property or bodily injury damage your may do to others with your vehicle. Most states require basic liability coverage for all drivers, but the coverage limits will vary. The minimums may not provide adequate coverage in the event of a serious accident, so it may be worth a few extra dollars to opt for a higher limit, say $150,000 to $300,000 or more instead of $50,000 for liability/bodily injury coverage.
Many states also require uninsured motorists coverage as well, in case someone who does not have insurance hits your vehicle. Even if it is not required, having this type of coverage gives you extra piece of mind.
Collision insurance covers damage that may occur to your vehicle whether an accident is your fault or not. If somebody runs into your parked car on the street in the middle of the night and takes off, you're covered. If you fall asleep and run into a tree, you're covered. Collision coverage is expensive, and it comes with various limits and deductibles. What ever deductible you choose, that's what you pay out of pocket before the car insurance policy pays for anything else. The higher the deductible, the lower the premium. Most policies offer deductibles that range from as little as $50 up to $1000 or more. On an older car with limited resale value, collision insurance may not be worth the cost. But on a newer vehicle with a high resale value (say anything that's worth more than $5000), I would definitely recommend collision insurance.
Comprehensive insurance covers things like storm damage, glass breakage, vandalism, and other bad things that may happen to your vehicle through no fault of your own. The cost is much less than collision insurance, and can more than pay for itself with one claim.
Emergency roadside assistance covers towing bills and service calls if your vehicle is disabled. The cost is low, and it usually ore than pays for itself with a single service call. But if you already have a roadside assistance program like AAA or OnStar, you don't really need the extra coverage.
Insurance companies typically give premium reductions for having a good driving record, for insuring more than one vehicle with the same company, for installing anti-theft devices on vehicles that do not come factory equipped with such, and for years of accident-free driving. Many insurers also reward you for loyalty by giving you a discount for every year you remain with the same company. For student drivers, most car insurance companies also give a good student discount to students who maintain a "B" or better grade point average.
Finally, you need to consider service (or the lack thereof) when shopping insurance. Getting cheap insurance quotes may sound great when it comes time to pay the premium, but what kind of service will you get when the time comes to turn in a claim? Some insurers treat their customers very well while others treat you like a criminal if you try to collect on your coverage. To find out which companies have the most consumer complaints, check with your Better Business Bureau.
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