Everything You Need to Know About Car Insurance
It’s a fact: You must have some semblance of auto insurance in order to drive. You don’t need the extra stuff like collision or comprehensive insurance to fill this requirement; all you need to do is reach a minimum level of liability coverage to qualify.
Of course, this also means that you must deal with an auto insurance company. While this might make you a bit nervous, you should bear in mind one important thing: All car insurance companies exist to help you get through one of the more sudden, potentially life-altering events that you could face.
How a Car Insurance Company Works
While an auto insurance company can be a helpful entity, keep in mind that they are also in the business of risk. Statistics certainly support this, since the average driver gets into a fender-bender about every 18 years or so. Moreover, the average cost of repairing a car after a wreck checks in at about $2,400. As such, a car insurance company is essentially banking on you to get involved in an expensive crash three to four times in your lifetime. Therefore, their insurance rates are set to reflect this projection, as your monthly premium will be set in order to help offset these pricey payouts.
And if you dig a little deeper underneath that average crash and cost metrics, you’ll find a host of other variables that play a huge role in how a car insurance company operates – specifically, how they determine a person’s monthly premium. These factors include:
- Your age
- Your gender
- Your previous driving history
- The car you drive
- Your average driving distance to work
- Where you park your car
- The type of job you hold
- Your marital status
- Your credit history
Each of these variables is factored in as a car insurance company sets your rate. Some may universally work in your favor, such as if you are a female or if you have a sterling driving record. Others may gradually shift from the bad side of things to the good side, such as when you hit a certain age or if you get married. Because most of these factors do change in accordance with the march of time and personal progress, it’s important that you let your car insurance company know whenever there has been a change in your life that may affect your premium, whether that change is a positive or a negative one.
Let the Buyer Beware
As the numerous mitigating factors imply, buying a car insurance policy that is right for you can be a complex, tricky beast. However it is one that can be tamed if you do your research and ask questions as you shop. Remember that while car insurance companies are technically around to help you out in times of crises, they are not obligated to divulge all of their information to you. Ultimately, it is up to you to drill down in order to see if that inexpensive rate that is being offered online includes potentially important stuff like collision coverage or comprehensive coverage. Not doing so up front could place you in a world of hurt that extends beyond the bumps and bruises you may experience after you get sideswiped in an intersection.
That being said, once your research and diligent questions leads you to the proper car insurance company, you can take comfort in knowing that you will have a very powerful ally in your corner if a crash occurs. And according to statistics, this alliance will be put into practice sooner or later.