Car insurance is often overlooked as one of the easiest places to save money. Raising deductibles, checking that you're getting discounts and being a safe driver will all help you save money. Comparing car insurance quotes could also lead you to the discovery that you can save some major bucks.
But are you also buying"too much"auto insurance for your needs?
Liability insurance is no place to cut corners -- it pays for the damage you do to others and protects you from financial ruin in the event you cause a major accident. But take a magnifying glass to the other parts of your policy and you may find you're buying more car insurance than you're likely to use.
"But remember, each individual has different insurance needs," warns Jerry Hagins, public information officer for the Texas Department of Insurance. "So to say that someone may be overspending on one type of coverage may not be true for someone else. A licensed insurance agent should be able to assist drivers in determining what coverage is right for them."
5 places to examine auto insurance coverage
Are you overinsured? Here are five areas of coverage where you may have too much insurance or redundant insurance:
For instance, take the 1994 Honda Accord. According to recent rankings from the National Insurance Crime Bureau, it was the most-stolen car in 2009. Now look at that car's value. According to NADAguides.com, a 1994 Honda Accord EX with 160,000 miles would be worth about $3,300. That's approximately what you'd receive from comprehensive insurance if the car were stolen. You would want to weigh that amount,minus your deductible, against the premiums you pay for comprehensive coverage.
Don't skimp on car insurance essentials
In your search for lower auto insurance rates, make sure you still have coverage that will protect you against disastrous losses. Experts agree that both adequate liability coverage and uninsured/underinsurance (UM/UIM) coverage are must-haves for any auto policy.
"Liability coverage protects your assets, like your home and other valuables, which you could lose in a lawsuit if you're found responsible for an accident," says Dunbar. "Drivers should purchase more than the state minimum limits based on the value of their assets."
UM/UIM coverage pays for injuries to you and your passengers when another driver is at-fault and doesn't have enough insurance to pay for his damages -- or doesn't have auto insurance at all. And with more and more uninsured motorists on the road, you don't want to take your chances.
Finally, whatever auto insurance options you choose, don't neglect to shop around. You could save hundreds by simply comparing auto insurance quotes.
Thomas Tennant is a corporate communications, media relations and online content professional. Previous experience includes more than a 12 years as a print editor and journalist. Tom also serves as an entertainment guide for About.com and is publisher/editor of MidwestMovieMaker.com.
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