Do You Have More Car Insurance Than You Really Need?
If you are tired of paying an arm and a leg each month for car insurance, now is a great time to take a few minutes to review your coverage options. You may just find that the reason your monthly premiums are so high is that you are carrying more coverage than you truly need. Taking the time to ask yourself the following questions can help you to determine whether or not this is the case, as well as help you to decide just how much car insurance you really need.
How Much Has Your Car Depreciated Since You Bought The Policy?
People often purchase a car insurance policy and then simply allow that policy to automatically renew at the end of each year without taking the time to review the coverage options and determine whether or not they still reflect their actual insurance needs. The problem with this is, the coverage options that you originally chose would have been based in part on the resale value of your vehicle at the time the policy was purchased. However, this value will have depreciated each year. If you are still carrying the same amount of coverage as you were when you first bought your car, chances are you are paying too much for auto insurance.
While depreciation will play a role in the resale value of all vehicles, it will have the most significant impact during the first few years of a car's life.
Does Your Collision Coverage Cost More Than It Can Pay Out?
As the value of your vehicle drops, so will the maximum pay out that you can receive from your collision coverage. This is because a collision policy will never pay more than the total value of your vehicle, even if the coverage limits you have chosen exceed this resale value.
If you are still carrying collision coverage on your vehicle, it is important that you take the time to carefully consider the cost of this coverage versus the cost of replacing your vehicle. If you find that you are paying more for collision coverage over the span of a few years than this policy will every pay out, continuing to carry this coverage will prove to simply be a waste of money.
Do You Receive Rental Car Or Roadside Assistance Coverage Through A Different Venue?
Another area where many drivers overspend on car insurance is with additional coverage options, such as rental car or roadside assistance coverage. This is because while most insurance companies will offer this type of coverage, many drivers actually already have this coverage through a different venue. For instance, many credit card companies now offer rental car insurance. It is also quite common for car dealerships to offer roadside assistance for a period of time after a car is sold. This free coverage is often used as an incentive to try and get individuals to purchase a car from their dealership.
If you are currently carrying double coverage for things such as rental car insurance, you could be paying far more than you need to each month for auto insurance. Thankfully, lowering your monthly premiums really can be as easy as contacting your insurance agent (like those at Nalley Insurance Agency LLC) and opting to drop this additional coverage.
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