Choosing the 'right' Auto Insurance
A Insurance Article Contributed by Deepak Cutting
Choosing the 'right' Auto Insurance.
In auto insurance you buy the security against payment of premium. If the premium is reduced too much, the auto insurance policy available at that cost may not have the risk cover that you need. An auto insurance policy must meet the protection required but not have the extras that can be done away with, for it to be easy on your pocket. The person negotiating an auto insurance policy must understand exactly what protection he is going to get against payment of the insurance premium.
How Much Liability Auto Insurance Do I Need?
As much as you can afford to buy. Here a small increase in premium will result in a big increase in cover. Also, liability insurance is the most important part of the insurance policy. An accident may impose a lot of third party liability on you and the insurance policy protects your pocket against such liability. Standard Liability auto insurance is the minimum mandatory and therefore must be purchased.
What about Medical or PIP Coverage?
Personal Injury Protection (PIP) is the policy, which includes medical benefits, compensation for loss in wages, accidental death and funeral expenses etc. This may not be required if there is a health insurance policy already providing similar cover to the beneficiary. However, a decision must be taken taking into account the fact that a PIP policy may cover injury risks to other occupants of the vehicle also, which the individual health insurance cover would not. Also, the law may require this type of auto insurance.
How Many Uninsured and Underinsured Motorist Coverage?
Since underinsured drivers are substantial, it is wise to obtain protection here. The level of such protection should ideally be the same as liability or third party auto insurance provision.
What is the Correct Amount of Deductibles to Opt For?
The level of deductibles should be as high as you can comfortably afford, in the event of an accident.
Any Special Auto Insurance Arrangement Required in the Event of the Vehicle Being Leased?
Yes. Your financier may require you to take full comprehensive auto insurance cover. Must check this issue with your lessors.
Is the Insurance Cover in Place before Purchase of the Vehicle?
Yes, if that is your first vehicle. If you already own another vehicle, the already available insurance cover is likely to cover the additional vehicle also for the first 30 days. In the meantime, arrangements are to be made for the new vehicle.
What is the Ideal Level of Comprehensive Auto Insurance in Respect of a Used Vehicle?
The liability (third party), medical, uninsured and underinsured covers should be the same as in case of a new vehicle, since the amount of claim that may become due in these cases is independent of the age of the vehicle. However, if the vehicle is old and considerably depreciated, the comprehensive limit on such a vehicle need not be high.
Will You Need a Fresh Auto Insurance Policy If You Move to Another State?
Not if you will be moving back within six months.
If I Will Not Be Driving for a While, Should I Suspend My Auto Insurance for That Period?
The trouble involved in suspension of the insurance cover for a short period may not be worth the benefits accruing from such suspension. If the vehicle is financed, the lien holders may want a continuous insurance cover.
