Perhaps you have just bought your first car, or your first new car, and you now have to find an agent and put a new car insurance policy in place. This can be a confusing endeavor for even experienced car owners, so here are a few basic things you should know about how to find someone that sells car insurance and what the policy should have in it.
There are three basic ways to buy a policy. You can buy it directly from the company with some insurance companies. They often advertise an 800 number that you can use to call direct and get a quote right from them or you can log into their website and have a quote emailed to you. You can also buy it through an agent that works just for one company, called a “captive agent”, or you could go to an independent agent, that sells policies for several different companies.
The Internet is a fantastic resource for finding car insurance companies and agents.
If you have just bought a car, a coverage topic that is probably of concern to you relates to insurance protection for the car if it is damaged. This is called the “physical damage” section of the policy and it contains collision coverage that you need if the car crashes into something, and comprehensive coverage, which pays for other types of damage like fire or vandalism. You will want this protection if your car is new or in good condition. For cars that are of lesser value, you can opt out of this coverage if you can afford to repair or replace the car on your own. If you have a loan against the car however, you will need this coverage.
The liability section of your policy protects you financially if you injure someone or damage someone else’s property with your car. Minimum limits are usually set by law, but these minimums are often not enough to protect you completely so always consider higher than the minimum limits. Choosing how high your limits are can be a difficult decision, and you should seek the advice of an experienced insurance professional on this subject. If your limits are too low, you could become financially responsible for an accident where the damages exceed your policy limits. In such a case, you might have to pay the difference yourself which could lead to financial ruin.
A third section of a car insurance policy covers medical payments. This coverage pays for medical bills for you or passengers in your vehicle. This is often referred to as “no-fault” insurance because it pays benefits to people regardless of who caused the accident.
These three basic components contained in an auto insurance policy have various details that you should explore with your insurance professional. Be sure to ask questions when speaking to your insurance professional and try to rely on several different sources of information so that you can compare the facts, and the costs from one to another.
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