Auto Insurance Frequently Asked Questions

It seems like auto rates change all the time.  How often should I shop for my auto policy?

Auto rates fluctuate more frequently than homeowner rates.  There are many factors that determine your auto rates and it would be good to check your policy on the renewal date.  Some policies renew every six months and others renew annually. It takes work on your part but the savings may be worth it.

What should I know about automobile insurance companies?

Just because you may not have heard about a company does not make them a “bad” company.  Many companies that advertise a lot may not be “good” companies.  Find out if a company as earned any recognition for excellence in customer service and 24/7 claim service.  Service criteria includes: Courtesy, Knowledge, Concern for the customer, Convenience of operating hours, and ease of reaching a representative.  Also check a company’s financial rating with A.M. Best or Standard & Poor’s.

Tell me about some of the discounts that will reduce my premium.

There are many depending on the company.  Here is a list of some of the more common discounts:  Homeowner and Umbrella Policies with the same company; multi-car discount; good driver discount; mature driver discount; driver safety course discount; claim free discount; longevity discount; good student discount; multiple car discount; hybrid vehicle discount; and association and group discounts.

What liability coverage is required by law?

$15,000 per person, $30,000 per accident for bodily injury; $5,000 for property damage.

There are so many limits of liability available.  How do I know what is right for me?

This could be a legal question but some guidelines could allow you to choose the correct limits:  Minimum limits of Bodily Injury Liability do not go far in any hospital or emergency room; the more serious the accident, the more need for increased bodily injury limits; how many miles a year do I use my auto; and what are my other assets.

That still does not tell me what limits I should have.  Do I need an Umbrella Policy as well?

One way to compare is to get several quotes on different limits and keep the premiums within your budget.  Most agents would recommend higher limits to safeguard your exposure. Umbrella coverage can be purchased in layers of $1,000,000 over the primary coverage of your policy.  Sometimes if there are discounts on the Umbrella Policy you may save enough to justify the protection of this policy.

Why do I need medical payment coverage?

Medical payments coverage is goodwill medical coverage that pays for emergency or first aid in case of bodily injury in an auto accident.  It comes in increments starting at $1,000 to $25,000 per person.  It would cover anyone in your auto or anyone that you would be liable for.  With so many Americans who do not have health care coverage this would be an important coverage to add to your policy.

What uninsured/underinsured limits should I carry?

A recommended amount would be to carry the same limits that  your bodily injury section has.

When should I carry comprehensive and collision?

If your car is financed this coverage is required by your lender.  Also if your car is newer it would make sense to be able to replace it with a like vehicle.  If the car is older you may not think that the cost of the premium would make sense.  Also there are deductibles to this coverage meaning that you would be responsible for the first dollars paid out in a claim.

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