How To Buy Car Insurance Essays - Types Of Insurance, Free Essays

How To Buy Car Insurance Essays - Types Of Insurance, Free Essays How To Buy Car Insurance Friday, December 01, 2000 HOW TO BUY CAR INSURANCE Many people look forward to buying car insurance about as much as having their wisdom teeth pulled by a dentist named Dr. Pain. Today I intend to show you how to take a lot of the sting out of purchasing car insurance by arming yourself with a little knowledge. Many people believe car insurance is a simple as black or white, either you have liability or full coverage. In fact there many important options in between. In becoming informed you will need to know how to research, and what questions to ask. The three key considerations when purchasing car insurance are price, coverage, and company. The first key consideration when buying car Insurance is price. According to Glenn Hardman at San Diego Insurance, There is no one company that has great rates for everyone. He further stated, It really pays to shop, shop and when youve had enough shop some more. And if it sounds to good to be true it usually is. Different companies target different age and risk groups, so while one company has a good price for your friend, they make not have a great price for you. Usually 10-15 quotes will probably give you a good range of prices to choose from. GOTO VA1 In this graph, I compared rates from the Facilities and Service Corp V9902.4 a software company that produces rates for insurance companies. The example here is a 22 year old single female with two tickets driving a 94 Honda. As you can see her rate varied between companies by well over a $1000 for the same coverage depending on only the company. A good resource I found was the yellow pages, the listings are localized to your specific area and everyone who is anyone is there both big and small. The second key consideration when buying car Insurance is coverage. Coverage varies from company to company but the basic components usually remain constant. The first is liability. Liability pays in the event you hit and injure another person or damage there vehicle, and is required by law of every driver in California. The two parts of Liability coverage are Bodily Injury and Property Damage. Both are expressed in thousands of dollars. GOTO VA2 Here are the minimum limits as required by the state of california. The first number is the per person limit and second is per accident. This means that if I have an accident with this coverage the insurance company will pay a maximum of $15,000 per person up to a total of $30,000 any number of people per accident for bodily injury. The property damage is the second number and indicates how much the company will pay to fix the other persons car or property. In this case $5,000. This is not a lot of coverage. If I was to hit a pedestrian in the crosswalk this coverage could run out in a hurry and I would be held liable for anything the insurance didnt cover. Many people with equity in their homes or with other assets will opt for greater coverage such as 100/300/50 as shown below. The second is medical payments. Medical payments pay a flat amount per person for anyone injured in your car regardless of fault. They range from between $500 to $5,000. This amount is not meant to absorb the cost of an injury, but to offset immediate out of pocket expenses such as health insurance deductibles. The third is uninsured and underinsured motorist coverage. This protects you and your passenger in the event you are hit by a driver with no insurance or not enough insurance. The fourth is comprehensive and collision covers damage to your car. Collision pays to fix your car in the event it is damaged in an accident that is your fault. Comprehensive pays in the event of fire, theft, and vandalism or anything collision does not. A deductible will usually apply and is the amount of money you must first pay and the insurance will pay the rest. Deductibles range from $50 to $5000. The higher the deductible, the lower your cost. The fifth is towing and rental reimbursement. Towing provides a flat amount of coverage