Some Things to Think About Before You Buy Car Insurance

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The first step in buying car insurance is to familiarize yourself with what’s covered by different auto insurance packages and add the types of coverage that make sense for you, your budget, where and how often you drive and your car.

Here is some information to help you decide:

Research Your State’s Minimum Car Insurance Requirements

Just about every state requires that you carry liability insurance, beyond that, 15 states also require Personal Injury Protection, sometimes known as PIP.

Know What Kinds of Car Insurance are Available

Most drivers choose to purchase auto insurance that goes beyond their state’s minimum, but what they add varies from driver to driver. Everyone’s needs vary. For instance, some people choose to buy rental insurance to extend their policy to any cars they might rent. For people who lease, there is specific insurance to cover the total cost of replacing the car if it’s totaled.

Set a Reasonable Budget

While everyone likes to get a deal, and buying only the minimum liability can seem tempting, think about all of your potential costs. You want to choose a policy with a monthly premium you can easily afford, but you also need to consider all of the possible accident scenarios.

If you were in an accident, what would financial burdens would your policy need to protect you from in order to remain solvent. With many insurers, the different in premium between minimal liability coverage and a policy with more extensive coverage can be very small.

If you know your state laws and have examined your personal needs, now you

Get the Right Kind of Insurance for Your Car

Whether or not you should choose to buy comprehensive and collision coverage depends on how much your car is worth. Insurers generally agree that if the value of you car falls below $2,000, it’s not worth buying this kind of coverage for your car. For more expensive vehicles, the peace of mind of knowing that your insurance will pay the full cost to replace your car after an accident will be worth the extra $200/year or so you’ll pay in premiums.

Make Sure You’re Not Buying Redundant Insurance

Read your homeowners or renters insurance policy, it may already cover certain types of vehicle damage. If you have good health insurance, you probably won’t need any kind of injury insurance beyond your state required Personal Injury Protection.

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