Best-Kept Car Insurance Secrets

Dealing with auto insurance companies can be particularly complicated. In order to level the playing field, check out the car insurance industries’ best kept secret below:

Car Rental Insurance: Is it necessary?

We all experienced how car insurance agents would persistently persuade people to purchase car rental insurance. Car rental insurance is commonly known as collision damage waiver (CDW). This waiver is normally endorsed by rental car agents who often receive incentives to further push an already oversold product. If you have full insurance on your vehicle, you don’t need CDW. Full car insurance coverage already includes collision and comprehensive. This means that in most cases, this type of coverage is unnecessary and saying no to it will save you money.

On the other hand, if you are driving a 1972 Ford Pinto with just a liability or no insurance coverage at all, then you may need CDW. Of course, that’s assuming that you do not have any credit card that offers protection. There are many credit card companies which offer car insurance protection as long as the whole rental car transaction was charged to a certain credit card. To find out, you may check with your Credit Card Company or personal car insurance provider before declining the CDW coverage.

Don’t Let Your Friend Borrow Your Car

Think twice before you let a fried borrow your car. Lending your car is just like asking for trouble, a real expensive trouble. If you lend your car to a friend and s/he got into an accident, it’s your responsibility. It’s you who have to file the claim with your insurance provider and not your friend. Worse, you are also responsible for any deductible. The accident that your friend cost may leave a lasting mark on your record and this increases your rates even if you were not in the car at the time the accident occurred.

Mind That Credit Score

Surprisingly, even your credit score is being assessed by your car insurance provider. This is usually done during the time of application or prior to renewals. It is widely believed that if the candidate is responsible with his credit and pays on time, there’s a less likelihood of making regular claims. Statistically, if you have dubious credit history, you are seen as someone inclined to file claims. Nevertheless, the utilization of this credit score method may cause you to pay higher premiums regardless of your clean driving record and no previous accidents.

True Value? Not Always.

If you are involved in an accident and totaled your car, your insurance provider will have to pay the approximate amount of money of an equivalent car. That said, this do not happen all the time because many insurance providers do not use the NADA standards nor the Kelley Blue Book to estimate values. They have their respective methods and often, will consider quotes from various dealers that are not always attainable. Hence, there’s the possibility that you will not be getting the value of the specific car that you own.

Every car is different and insurance providers are keen on factors such as condition, mileage and repairs. In case they opt to use one of these methods, it’s best to present your insurance provider with local quotes of your own. Keeping a documented vehicle history is recommended as well. This will be useful in case a dispute on repairs and maintenance arises. Make certain that the amount that you and your insurance provider settle on will include sales tax for the purchase of your replacement automobile. This is often left unsaid by most car insurance providers and replacing your car must not come with any additional taxes. If you own a classic car, it’s advisable to purchase classic car insurance as this type of insurance provides replacement value coverage.

If get into an accident and your car is deemed as repairable, as for diminished value compensation. Diminished value compensation provides coverage for the loss of market value of your car incurred due to the accident. The fact is, your car will value less once it has been wrecked even if it is completely repaired and bought back to new condition. Generally, people do not want to purchase a car that’s been involved in a major accident and this could significantly hurt your re-sale value. Always check with your insurance provider if they include diminished value on their policy.

Marital Status

It’s not uncommon for auto insurance providers to charge extra for certain status penalty. Unfortunately, this type of discrimination is totally legal and is being practiced in most states. Being single, divorced or even widowed can add to your insurance premium. Insurance providers will argue that the actuarial tables’ supports their guidelines like younger motorists have higher probability of getting into an accident the same statistic indicate that unmarried people are more accident-prone than their married counterparts.

If you are single and on the hunt for insurance quotes, the act of shopping around should eliminate these kind of companies.

Residency

One of the major considerations of auto car insurance companies when determining rates includes residency. If you are based in urban areas, your rates will increase significantly. This is because the likelihood of theft and/or accidents is profoundly lower in rural areas. Whereas factors such as limited parking, traffic and bigger number of uninsured motorists are elements for people living in inner city. This means that in some areas, the insurance rates are more almost double in cost as opposed to their rural counterparts.

Profession

Indeed, there is a statistical relation between your auto insurance risk and your profession. A recent study shows that scientists, pilot, navigators, actors and performers pay the lowest insurance rates with only an average of $935.76 each year. On the flip side, lawyers, judges, executives and entrepreneurs pay the highest insurance rates with an average of $1,383.63 each year.

The differences in rates may be due to a few factors. The latter normally have stressful and rigorous occupations. They spend the bulk of their time on the road and more time using their mobile phones and this is naturally a high-risk situation which is why insurance providers are requiring more expensive rates. On the other hand, scientists, pilots, navigators, actors and performers are deemed as less risky because their driving routine are result of skills necessary for their jobs. One example would be the meticulous and detail-oriented nature inherent with pilots will result in safer driving and lower insurance rates.