Things to Consider Before Buying a Car Insurance

These days owning a car seems more of a necessity than an option. We use them to take our kids to school, or to get to work in the mornings. Added to that are our social events and annual vacations. As with all our valuable possessions, insurance has to be an important consideration. If someone were to crash their car whilst it was uninsured, there would be legal and financial consequences. 

In an ideal world a person would choose the first car insurance policy they find. In reality, however, there are many things to consider before doing so. We will take a look at these now.

Online Comparison Sites

As with all things, it pays to shop around before we buy. The beauty of specialist internet sites is that someone else can do the work for you. People can access an online free car insurance calculator to save themself up to $1,000 a year. Modern website technology enables people to enter their postcodes, before receiving more than thirty quotes for comparison. Such information is available 24/7 and is provided with no obligation to buy. 

People can often decide the level of information they enter into such search sites, but the more they provide the more accurate the quote will be.

The Need For Full Documentation

Cheap insurance companies may be requesting details from a person’s driving license or car registration documents.

If someone has been enjoying a no claims discount they may be required to provide documentary evidence. Our previous claims history can be a key factor in deciding the premium costs, so companies will be requiring accurate data for this too. 

The Need For Full Documentation

Decide On The Excess And Level Of Cover

The policy excess relates to how much you pay in the event of a claim, before the insurance company covers the rest. In addition to a compulsory excess amount, customers can choose their voluntary proportion. The more you are prepared to pay, the lower will be your premium.

Car insurance policies usually offer three types of cover:

  1. Third-party 
  2. Third-party fire and theft
  3. Comprehensive cover

The first option is the cheapest and most basic. It will only pay out for injuries sustained by other people or their vehicles. It won’t cover you or your car, but only your passengers. The second adds the events of fire or theft to this cover. Anyone who chooses the comprehensive cover option will have more peace of mind, but they will have to pay more for it. 

Optional Extras

It’s important to understand that ‘comprehensive’ cover varies between companies. This means there may be extra elements you may need to add to the contract. Ask your insurance broker about this, work with licensed and established brokers in your area. If you want to be an insurance broker in Canada, here’s how to get insurance license in Ontario.

The Need For Accurate Mileage

If an odometer has been illegally adjusted, it could provide an inaccurate record of the vehicle’s mileage so far. This is something to check before buying the vehicle. Insurance companies will want to know how many miles a driver will cover each year. The higher this number, the greater will be the premium. 

In both the above scenarios it is crucial that the insurance company possesses accurate information. Should it prove false, it could invalidate the policy. 

Honesty Is Required

In addition to matters of mileage, people need to be honest over their previous claims or convictions. They may alternatively have modified the vehicle for speed or aesthetic reasons. All these factors will be likely to increase the insurance premiums. 

If people fail to disclose such details, they may well save money on their insurance, but could discover that the insurance company refuses to pay out in the event of a claim. 

Money Saving Ideas

If someone pays to protect their no claims bonus, this may or may not save them money, depending on whether they make a claim or not. It’s also true that their future premiums could still increase should they have an incident with the vehicle. 

People who can afford to pay the whole years’ premiums upfront will enjoy a discount not available to monthly payers. 

Whilst it can take time and research to discover the best policy, it’s worth it all to gain the most suitable cover for you and your vehicle.