People are always looking for ways to save money on auto insurance premiums. One of the most popular methods to reduce auto insurance premiums is to increase the deductible on your collision coverage, opt out of comprehensive coverage and lower the limit of your liability coverage. For those people who do very little driving or have older model vehicles, this can make sense, but often it is just a recipe for disaster.
Collision reimburses you for the cost of repairs or replacement of your car after an accident. A high collision deductible could wreak havoc on your budget after one accident—since the deductible represents your out-of-pocket expense.
Liability coverage such as bodily injury, property damage, uninsured and underinsured motorist coverage are also designed to save your assets. Lowering your liability limits restricts your ability to pay for damages as a result of an accident with insurance funds and could lead to debt or bankruptcy if your personal assets must be utilized.
- Comprehensive covers you in the event your car is the victim of a natural disaster, vandalism or theft. If you have an older car, you might consider dropping this coverage altogether—especially if the premium costs more than the value of your car. Understand, however, that you will have to foot the bill if you get in an accident that is your fault, or if the car is stolen or totaled.
When you consider all the coverage offered by auto insurance policies, you can use deductibles and limits to create an affordable policy that does not leave you in the financial lurch after a claim; but you must be careful not to exclude important coverage, create limits that are too small or deductibles that are too high. Let us work with our many auto insurers to create a comprehensive insurance policy that you can afford. We have many auto insurers that will accept a foreign driver’s license, we can write a SR-22, and even if your driving record is less than perfect we have an insurance company for you.
And remember, when you think of insurance, think The Insurance Center for all of your insurance needs!