5 Things To Know About Auto Insurance

Posted on: 23 February 2022

Need to buy auto insurance and have some questions about it? It will help to know the following five things as you are shopping around. 

What Is A Household Rating?

Be aware that insurance companies use a household rating to determine your auto insurance premiums. They essentially look at the people that live in your household, based on who would be a passenger and a potential driver, and use this to determine how much you pay for premiums.

This makes sense from a medical coverage standpoint, because more household member can result in more medical bills if the vehicle were to get into an accident with everyone inside it. Younger drivers are also more likely to cause accidents, and simply having more drivers means that the cars will be used more frequently. All of this is factored into what you could potentially pay.

Will Your Home Insurance Cover Your Car In A House Fire? 

If your garage were to burn down while your car was in it, know that you still would use your auto insurance policy to cover the damage to your vehicle. This is due to vehicles typically being excluded from home insurance policies because they require their own coverage due to the high vehicle value. 

What Coverage Do You Need For Hit And Runs? 

A hit and run can happen while you are driving it or while it is parked with no one in it. Ask your insurance agent what kind of coverage you need for this specific situation. While it should be covered under collision coverage because a vehicle is hit by another vehicle, some insurance companies may consider damage to a parked vehicle to be covered under comprehensive coverage. This is because it is considered a form of vandalism rather than an accident.

Should You Always File An Auto Insurance Claim To Repair Damage?

Any time you are in an accident, it is always worth considering if you want to use your car insurance coverage. It's important to look at your deductible and what the total damage to your vehicle actually is. If the damage is less than your deductible then you will be better off not using insurance to make a claim. 

Are You Required To Have Auto Coverage For Your Entire Term?

When you purchase auto insurance, you typically buy insurance for a set policy length, which could be six months or a year. The policy is open ended on your end, where you can cancel your insurance and get reimbursed for the unused portion. However, your auto insurance provider cannot cancel your insurance during the policy terms, which is how that term limit is designed to protect you.

For more information on auto insurance, contact a professional near you.