Buying car insurance for the first time might seem daunting, but it doesn’t have to be. Here are six simple tips that can make picking the right coverage easy.
1. Shop around for multiple auto insurance quotes
Even if you think you’ve found the perfect rate after your first quote, it’s worth shopping around.
Insurance rates can vary drastically from company to company, and each provider will view your driving record differently. A rate comparison site, like InsuranceHotline.com, can help you compare more than 30 insurance providers at once to ensure you get the best policy at the best price.
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2. Compare apples-to-apples coverage
If you receive a wildly different quote from two insurance companies, check if the plans are comparable and offer the same amount of coverage. Say one company offers a 30% savings on your premium, but it provides lower liability coverage. In that case, you must make a judgment call on whether that’s worth it.
Look at quotes for the same coverage amount from each insurance company before making your decision — it’s the only way to get an accurate comparison. Additionally, don’t just consider the premium. Look at the coverage options to ensure you see the complete picture.
3. Think about what kind of coverage you really need
Mandatory coverage can vary across Canada, and there are optional coverages that car owners can add to their policy. A basic, bare-bones plan might be cost-effective if you have an older car worth less than your policy’s deducible or if the premium cost exceeds the potential payout.
Say you have an older car valued at around $1,200, and your deductible for collision or comprehensive coverage is $1,000. Should you need to file a claim, the maximum payout you could receive is $200. At this point, you’d want to consider if it is worth the extra premium you pay annually for the coverage.
But if you have a newer, more expensive vehicle, you should consider a more comprehensive policy. For instance, if you were to get into a collision, you’d want to cover your vehicle’s cost and pay an affordable deductible. Moreover, if you’re leasing your car, the dealer may require specific coverage under the terms and conditions of your lease.
4. Educate yourself
Once you have a general idea of the auto insurance market, consider what you want from your insurance provider. The company should be reputable, so it’s worth looking at reviews online. See what people are saying about the customer service and level of support.
5. Understand how your premium is calculated
When calculating your quote, insurance providers consider several factors, including your vehicle, age, gender, home address, and driving history, among other things. If you buy a new car, move to a new area, or gain driving experience, it could make a difference to your premium.
Poor driving behaviour can also affect your insurance rate. Traffic tickets can remain on your record for up to three years, while collisions can stay for up to six years. Drivers will typically pay a surcharge to their insurance provider during that time. That’s why good drivers can save more on car insurance.
6. Ask about discounts
It never hurts to ask about discounts. From winter tires to affiliations, discounts are available to all age groups. You might be eligible for specific deals based on your alma mater, employer, or squeaky-clean driving record.
Compare car insurance quotes to ensure you get the best possible price for the coverage you need.