What First Time Car Insurance Buyers Should Know

There is no one size fits all policy when it comes to buying car insurance in NY. There are, though, a few things everyone should know before diving in and buying that first policy in order to make sure that you’re getting the right NY car insurance coverage to meet your needs.

 

These tips for buying auto insurance in NY, especially for first time car insurance buyers, will help you get the right coverage for the right price.

Tips for First Time Car Insurance Buyers

Determine What Coverage Is Necessary

This will be different for different people depending on your comfort level, the cost and type of your car, and how you’ve purchased the vehicle. For instance, your needs will be different if you paid cash for your car than if you’ve financed your vehicle. You might also opt for less coverage if your car is paid off, older, and worth very little. At the same time, you might opt for more coverage for a more expensive vehicle or one you’ve put several upgrades into. Just remember, you have many coverage options to consider including the following.

 – Liability Coverage – All drivers in New York must meet specific legal requirements for liability coverage. For example, motorists must carry a minimum amount of liability insurance of $25,000 for bodily injury to one person and $10,000 for property damage in a single accident. This specific coverage provides protection, up to the limit of your plan, from the financial fallout of accidents in which you are determined to be at fault. Liability protection covers damage you cause to other vehicles or properties in these accidents but provides no coverage or protection for your own vehicle.

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  •  – Comprehensive Coverage – Comprehensive insurance coverage provides protection for things like tree limbs falling on your car, vandalism, and other non-collision types of damage to your car.
  • Collision Coverage – Collision insurance provides for repairs to your vehicle in the aftermath of a collision with objects or other vehicles.
  •  – Uninsured/Underinsured Driver – There are times when, despite state laws requiring minimal liability coverage, the other driver has failed to meet these requirements or the costs of repairs, medical expenses, etc. exceed the value of the minimal coverage. In these events, uninsured and underinsured driver coverage will make up the difference so you can get the repairs and medical care you need without facing undue hardship.

Consider Optional Coverages

There are a variety of different types of optional or add-on coverage you might be interested in considering with your car insurance. This includes things like towing, roadside assistance, and even rental car coverage. Towing prices start at an average of $80 in New York, not including distance traveled and additional fees. Having this type of insurance can pay for itself with just one claim. Optional coverages all have strengths and weaknesses and may be worth discussing with your agent to determine if they are the right choices for you.

Choose a Deductible You Can Live With

Your deductible is the amount of risk you take on in the insurance transaction. The higher your deductible, the greater your personal risk, but the lower your insurance premiums will be. Lower deductibles reduce your risks but raise your premiums. You must find the right balance according to how much money you can afford to invest in repairs and such in the event of an accident.

Utilize an Independent Insurance Agency

Working with an independent agency means your agent can shop multiple insurance providers to find the best combination of coverage and cost to meet your needs. When you work with an agent that only deals with a single insurer, you are limited in the coverage that is available and the costs you’ll pay for that coverage. You may even find that if you have a tricky driving record, you may have trouble getting insurance at all with a single provider.

Inform Insurance Agency of Security Features

Features on your car like etched VIN numbers, anti-lock brakes, security systems, and on-board GPS tracking can help you negotiate for lower rates with insurance companies because they are investments in the security and recoverability of your vehicle. Make sure you inform your agent of these features when you’re exploring your coverage options.

Ask About Bundling

Another great way to save money on monthly premiums is by bundling policies. This means you purchase your auto insurance and home, renters, boat, or other policies from the same provider and they reward your loyalty by offering discounts on one or more of the insurance products you purchase from them.

Educate Yourself About Available Discounts

The more you know the better prepared you will be to get the best possible prices. Some companies offer auto insurance discounts for things like good driving records, taking driving education courses, and even for driving few miles in the course of a day, week, or average month (ideal for people who live in New York City and do little driving but own a car for when traveling outside the city).

Family or Individual Policy

If you’re a teenager looking to buy your first auto insurance policy or a parent of a teen getting ready to tackle the road alone, you may be wondering if it’s more beneficial to have a plan together or two separate plans.

The answer varies and depends on your unique situation. For new teen drivers, it’s typically less expensive and less of a hassle to add them to their parents’ policy. Keep in mind that male drivers will typically increase premiums more than new female drivers. You can save money if your teen gets good grades or eventually establishes a good driving record.  

If you have a teen that gets in a few too many fender benders, it’s probably time to get them a bit more training and take them off your policy. While they’ll have a higher premium than if they were on a family policy, the savings from the group policy could balance out the payments.

Know Limitations of Business Policies

Are you looking into a business auto policy or wondering if you can combine the benefits of an existing policy to cover personal vehicles? Commercial auto insurance in New York needs to include several coverage features, including a minimum of $50,000 in bodily injury for two or more people and $50,000 in death coverage for an individual. Once you get past the basics, business policies combined with personal policies can get a bit tricky.

As a business owner, your personal auto policy can provide limited coverage for occasional business use of your vehicle. At the same time, an employee’s personal policy can also cover some business use of their vehicles. But this coverage will not help should the vehicle in question be used primarily in business. If the vehicle is owned by the business, personal auto policies will not cover any incidents it’s involved in.

Consider the following example. If you’re driving your personal vehicle to a business presentation but fail to notice a vehicle stopped in front of you and hit it, causing several injuries, your personal policy will most likely defend you on an individual level. But your limit is likely to be too low for multiple victims and if any of the victims sue your business, legal expenses and settlements will not be covered. We always recommend discussing your unique situation with an insurance broker when it comes to driving personal cars for business and business cars for personal trips.

Understand Your Car Insurance Policy

This last tip essentially summarizes our entire article. No matter what type of policy you choose, who you purchase it from, what add-ons you consider, how much your premium is, or what your policy limits are, make sure you understand every detail. In fact, get to know your policy before you buy it. Understanding your policy inside and out will ensure you’re better prepared should you have to make a claim one day.

It may not seem like a lot at first glance but knowing these things about car insurance, both for first time car insurance buyers and experts, can save you a great deal of time, money, and worry.