Here’s What Happens if You Pick the Wrong Auto Insurance

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Choosing the wrong auto insurance could cost you and leave you with inadequate coverage. Read on to learn more. 

It costs almost $9,300 a year, on average, to own a car, according to AAA. And when you think about the numerous expenses car ownership entails, including maintenance, fuel, and auto insurance, it’s easy to see why.

But if you don’t choose the right car insurance, you might end up spending even more than you bargained for in one way or another. So it’s important to select your coverage carefully.

When your car insurance isn’t adequate

The purpose of having auto insurance is to protect yourself financially if you get into an accident or if your vehicle is stolen or sustains damage. States generally have laws requiring drivers to have a minimum amount of liability coverage, and those can vary depending on where you live. But if you opt for the bare minimum, you may not end up with enough coverage once you’re required to actually use it.

If you don’t have enough coverage and are found to be at fault for an accident, you could end up having to pay beyond what your auto insurance company will cover. So for example, if you’re covered for $25,000 worth of damage but you’re found to be liable for $30,000 worth, you might have to shell out the difference in the absence of having adequate coverage.

When you have more coverage than you need

You might think it’s best to err on the side of buying more auto insurance coverage than you need. That way, you won’t have to worry about having to shell out money in the event of an accident or other incident.

But paying too much for auto insurance could mean throwing your money away. And that’s not something you want to do either.

One trap you might fall into these days is paying for a standard auto insurance policy when you’re working from home on a full-time basis and are barely driving your car. In that case, it’s definitely worth it to contact your auto insurance company and see if there’s a better option, such as a policy where you actually pay by the mile rather than pay a blanket premium for the year.

Do your research when buying auto insurance

Auto insurance can be a big expense, but it’s important to secure the right coverage for you. The best way to avoid a scenario where you’ve chosen the wrong auto insurance is to do plenty of research and make calls to different auto insurers to compare the rates they have to offer. The more questions you ask and the more you shop around, the less likely you’ll be to end up without enough coverage or paying too much for coverage.

Furthermore, once you land on an auto insurance company, it’s always a good idea to ask what discounts you might be eligible for. Drivers may be able to shave some money off of the cost of their auto insurance by bundling it with a homeowners insurance policy or by taking a course that teaches them how to drive more defensively.

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Ready to shop for car insurance? Whether you’re focused on price, claims handling, or customer service, we’ve researched insurers nationwide to provide our best-in-class picks for car insurance coverage. Read our free expert review today to get started.

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