Guest Post by James Oronoz
Generally, everyone is aware that car insurance is a necessity when driving on the road. You could even say that we’ve all seen at least one commercial telling us about how much money we can save. However, the question remains — how can you actually optimize your car insurance?
It’s best to approach this with a pay-now-save-later mindset that doesn’t require removing the necessary coverage or only signing up for a basic policy. Instead, it calls for a more strategic approach that balances your needs and budget.
With that in mind, let’s dive in!
It’s easy to take your car insurance for granted; after all, it’s not something you think about every day. Still, you should assess your current policy to ensure you have the coverage that’s right for you.
Think about it: do you have a rising young driver with a learner’s permit? Are you biking to work? Have you recently transitioned to working from home full-time? Maybe you are a driver who reduced your coverage because you weren’t driving much during the COVID lockdown and now that more Americans are hitting the open road, you need to revisit your policy. Whatever your situation, be sure you have enough coverage.
Some drivers think they are saving money when they carry the minimum insurance required, but the truth is this type of policy might cost you more if you are in a serious auto accident.
Most states require drivers to either carry bare-bones coverage (usually for bodily injury, personal injury protection, and property damage) or prove they can pay out of pocket if they're in an accident. If you, your passengers, or the other driver is seriously injured and you only have the minimum insurance, you could easily exhaust the small amount of coverage available to you. Unfortunately, this would add unnecessary strain to your budget, so it’s wise to avoid it.
Instead, follow your state’s requirements and add other protections based on your driving habits. For example, if you'd need a car to drive while your vehicle was being repaired, rental car coverage would be wise to add to your insurance policy.
Many people get comfortable with their insurance company, especially if the customer service is great and they’ve never had to file a claim. However, those details don't necessarily mean you’re getting the best deal.
National Insurance Awareness Day, which is June 28th of each year, serves as a gentle reminder to see if you are really getting the most from your auto insurance. Even though you may be satisfied with your current plan, it’s wise to compare policies from time to time.
Thankfully, you don’t have to do it manually! You can use a free insurance comparison tool online. Or, if you prefer, you can get quotes online from several companies. If you do find a cheaper rate for comparable coverage but don’t want the hassle of switching carriers, ask your current insurance provider if they will match the premium.
Also, remember to ask about discounts, like safe driving records, defensive driving course certification, or bundling options if you also have property or renter’s insurance with the same company.
Of course, we’d like to think that everyone who drives has insurance coverage, but that is not the case. It’s important to proactively protect yourself and potential passengers with uninsured motorist coverage. Then, if you are in a hit-and-run accident, or hit by an uninsured driver, your policy will cover your medical bills, lost pay, and other expenses. In fact, it also picks up the difference if you are severely injured by an underinsured driver. Basically, it is worth the investment in the long run.
As a reminder, your insurance deductible is the amount of money you’re responsible for paying out of pocket if an accident occurs. Depending on your driving record, the age of your vehicle, and how many drivers use one car, you could save money on premiums by raising it.
It’s kind of a pay-now-or-pay-later situation, but if you have a long-term clean driving record, increasing your deductible (for example, from $500 to $1,000) can be a significant cost-saver on premiums. Remember, the key here is to raise your deductible to an amount you can comfortably afford.
Overall, like automotive educator Chaya Milchtein says, it’s important to remember that "savings vary from person to person and insurer to insurer." Every individual has a unique budget, specific driving habits, and daily routines. You should always be honest about how these factors will impact your insurance preferences and check with a registered insurance agent before making any modifications to your coverage.
James Oronoz is the founding shareholder of Oronoz & Ericsson Injury Lawyers, a Las Vegas law firm dedicated to helping individuals navigate life before and after a tragic accident. He uses the knowledge he’s gained over 20 years to educate others on their legal rights, specifically pertaining to criminal defense and personal injury matters.
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