Your first car is often one of the most significant milestones in your young life. It signals freedom, adulthood, and endless possibilities. Of course, like all things, it comes with a cost, and just when you have the money for a car you find you can’t drive it without insurance.
First, a quick overview of what auto insurance is and what it covers.
It’s wise to familiarize yourself with a basic knowledge of the many types of insurance and how they relate to you.
Liability insurance: It protects others if you cause an accident and protects you if they decide to sue because of your actions. It will cover medical expenses for others and a legal defense for you if you are taken to court. Almost all states require liability. You can choose the minimum coverage required by law or a higher amount that will protect your financial future. It does not cover any damage to you or your car.
Collision insurance: If your car is damaged by hitting another vehicle or stationery object, this insurance coverage will pay to have your vehicle repaired. It usually has a deductible. By choosing a lower or higher deductible, you can adjust the premium. The higher the deductible, the lower the premium, but be sure you can cover the deductible, or you won’t be able to afford repairs. If there is a loan or lease, your financing company will require enough insurance to repair your car and protect their interest if it is totaled.
Comprehensive insurance: You will be covered if outside forces, such as a storm, hail, lightning, fire, flooding, vandalism, or theft, damage your car. If you hit an animal, it will help repair your vehicle. Broken glass can be covered under comprehensive. Again, you can choose the deductible that will determine your premium.
Uninsured/underinsured motorist: If you are hit, the other driver has no insurance, your medical expenses will be covered. This coverage does not cover the damages to your vehicle.
Many companies offer discounts for good students or packaging your home or renters insurance with the same carrier. Some insurance companies will lower your premium if you take one of their classes or use a device that measures your driving habits. Do your homework to see if the car you are looking at costs more to insure. Rates are based on the type of car, safety features, and the value of the vehicle.
You will not be able to drive off the lot without insurance, and while dealers offer insurance, be prudent and have an agent who knows you and your driving needs. They will be set up to initiate a policy when you find a car. Talk to Eric Luebbe Insurance today to find the best auto insurance coverage for your needs.