Auto Insurance Questions – Is Liability Or Full Coverage Right For You?
July 21st, 09In today’s sagging economic climate, many people are looking for ways to cut corners on their costs and save money, especially those of us who are attempting to rebuild our credit.
As you look over your monthly costs, there are certain things you can reduce and certain things you can’t. For example, you might switch to a cheaper cell phone program, or let go of the cable television. One thing that might not occur to you as an option right off the bat, though, is changing your auto insurance.
That’s right, auto insurance isn’t exactly a fixed cost. Even though it’s probably something you don’t put too much thought into, there are many different types of policies available and finding the right one for you can save you money, which adds up month after month.
The first thing to consider is how long you’ve been driving and whether or not you have a safe driving record. In reality, there are many landmarks or milestones at which insurance companies can offer you reduced rates, such as when you turn 25 and when you go a certain amount of time without getting into an accident or filing a claim.
However, it’s not too surprising to find out that many insurance companies aren’t in any real hurry to let you know about this. In many cases, you have to take it to them. So, if you’ve been a safe driver for a long while, why not give your insurance company a call? Chances are good you might be able to talk them into a reduced rate, especially if they think you might take your business elsewhere otherwise.
Secondly, consider the difference between liability coverage and full coverage. While many people like the peace of mind that full coverage affords them, liability can offer be a cheaper form of coverage that, for the most part, works out just as well.
What exactly does liability coverage offer you? Generally speaking, liability insurance will be described and sold as a package with a specific number attached, such as “30, 50, 20”. These numbers are commonly used throughout the industry and typically mean, in order, the maximum amount your insurance company will pay to cover the cost of bodily injuries, the amount they’ll pay for other injuries, and the amount they’ll pay on property and vehicle. As you can see, sometimes these numbers can run quite low, so if you ever are so unfortunate as to require hospitalization as the result of an automobile accident, you may find yourself hurting financially.
For the most part, however, if you’re a safe driver, liability insurance can be a way to save a few extra dollars each month. It’s something of a gamble, so you should be sure to weigh the pros and cons and make the decision that’s right for you. Just keep in mind the future at all times, and remember that cutting costs now is good, but achieving financial freedom is a long-time commitment that requires long-term planning and foresight.
