Car insurance is one of those things we all must have if you are a car owner, but do we always get the most out of our insurance policy and do we set up the right way that it would work best for us. Here is some interesting points you need to consider that can help you get more out of you policy.
1. Shift it around.
An important fact point and often overlooked is to shift the money around to the things that could wipe you out.
While most people could cover a $500 deductible, a $500,000 lawsuit would be a different matter. So why do so many consumers pay extra for low deductibles and carry close to the minimum on liability coverage?
Instead, raise your deductible (and bank that amount for emergencies) and increase your liability coverage. Your premiums should remain roughly the same
The rule of thumb in a society where critical care bills can easily cost six digits, nobody should carry less than $500,000 per person.
The good news: Taking your total liability coverage from the standard $300,000 to $500,000 will only cost about $60 a year for two cars or $60 for one car if you're a younger driver.
But younger people who have a fairly low net worth don't need hundreds of thousands in liability .Best bet: Talk to a professional you trust and come to a decision on deductibles and liability coverage that works for you.
You always want to look at the trade-offs -- what do I save in premiums vs. how much risk do I take on. Another place to shave some money from the premium, also known as medical payments coverage. If you already have health insurance for yourself and your family, that would cover your medical bills after an accident, he says. Why pay twice?
2. Not just total liability .
Many insurance policies specify that the company will pay up to $300,000 in total liability coverage if you are found liable for an accident, but only $100,000 for each person injured. That means if you are at fault in an accident that leaves someone with a $200,000 lawsuit, you will be on the hook for half -- even though you thought you had $300,000 worth of coverage.
Have your agent write the policy, so the total amount paid per accident and per person are the same. That way $300,000 in coverage means $300,000 in coverage -- no matter how you divide it.
3. Consider buying an umbrella policy.
If you have considerable assets or are likely to have them in the future, consider an umbrella policy that would cover both your home and auto. Umbrella policies usually start at $200 to $300 a year for up to $1 million worth of coverage.