10 Things You Should Know About Buying Auto Insurance How is Your Insurance Rate Determined? 1.- Two factors determine what you pay for auto insurance. The first factor is underwriting and the second factor is rating. Each company adopts its own rating system, although there are general guidelines that all companies follow. The single greatest influence on the rating process is claim frequency. 2.-Specific Factors that Affect Your Rate Your driving record – drivers with previous violations or accidents are considered to be higher risk Your geographic territory – urban areas have more claims than rural areas Your gender and age – males have more accidents; certain age groups have more claims Your marital status – married people show lower rates of claims Prior insurance coverage – if you have been cancelled for non-payment of premiums Vehicle use – higher annual mileage results in higher exposure to risk Make and model of your vehicle – luxury and sports cars average a higher number of claims 3.-Ask Your Agent About Discounts Discounts are awarded because the insurance company sees you as a “better risk.” Here are some discounts you should look for: multiple vehicles, driver education courses, good student, safety devices, anti-theft devices, low mileage, good driver/renewal, auto/home package. Not all states offer all discounts. 4.-Tort System vs. No-Fault System Each state must implement either a tort system or a no-fault system. 5.-Check Into Optional Coverage The most commonly recognized coverages, in addition to the basic liability package, are collision and comprehensive coverages. Collision coverage pays for physical damage to your car as a result of your auto colliding with an object such as a tree or another car. This is relatively expensive coverage and is not required by law. Comprehensive coverage pays for damage to your auto from almost all other causes, including fire, severe weather, vandalism, floods and theft. This coverage will also cover broken glass and windshield damage. Other optional coverages include medical payments, rental reimbursement and towing. 6.-Where to Go for More Information Information is available to consumers from a number of unbiased sources. These sources include public libraries, state insurance departments, online resources, consumer groups and consumer publications. 7.-Shop Around Before You Buy When shopping for auto insurance, premium quotations are a useful tool for comparison of different companies’ products. When asking for price quotations, it is crucial that you provide the same information to each agent or company. 8.-Where to Shop Call us 209-823-1731 :) Check the newspaper and yellow pages of the telephone directory for companies and agents in your area. In addition, ask your neighbors, relatives and friends for recommendations on insurance companies and agents. 9.-For Your Protection Once you have selected the insurance coverages you need and an insurance agent or company, there are steps you can take to make certain you get your money’s worth. Before signing an application verify that the company and the agent are licensed to do business in your state. 10.-Read Your Policy Carefully You should be aware that an auto insurance policy is a legal contract. It is written so your rights and responsibilities, as well as those of the insurance company, are clearly stated.© 1991 - 2014 National Association of Insurance Commissioners. All rights reserved..
Posted on: Fri, 19 Sep 2014 20:18:39 +0000
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