Mistake #1: Not fully understanding your coverage
To simplify this, the lack of research and fact finding creates issues. Don’t buy coverage you don’t need. Even worse, don’t accidentally skimp on coverage you do need. At the Jerry Hallman Insurance Agency, our exopertise means simplicity of choice.
Don't be shy about reaching out to a company representative for help during your decision-making process. They'll be able to help you figure out how much coverage you should buy.
Laziness is probably responsible for some of this. It's also easy to assume that ‘all insurance companies are the same,’ or ‘all similar car insurance policies cost the same.’
Check out the rates of at least three or four companies before you make a decision. Each of them may offer similar policies or services, but they're unlikely to be identical.
Each carrier can charge very different rates for identical coverage. Even if you already have car insurance, you should still shop around. Many experts will suggest that you compare multiple competing quotes when your policy is up for renewal, rather than automatically renewing. Not shopping around is a costly mistake.
"Full coverage" is a vague term. Some folks think that sending a check to Allstate or Geico means they're protected from anything that may happen to their cars.
Here's another situation where it pays to have a conversation with your insurance company. They can identify gaps in your coverage. They can lay out scenarios where you will need more coverage. Be selective in the coverage amounts you purchase, and only go for what you decide is sufficient coverage.
Who wants to spend more than they have to on anything these days? It shouldn't be surprising that a lot of people who want to keep their car insurance premiums low opt for minimum liability coverage.
Do a bit of research and talk with your agent about your coverage. If you rear-end a pricey car like a BMW, a minimum coverage policy probably won’t come close to covering the damage.Note: to learn more about why buying the minimum amount of auto insurance usually is a bad idea, read our article, "Why Legal Minimum Car Insurance is Not Enough."
Most of us choose a low deductible because...
Most of us choose a low deductible because we want to avoid paying too much out of pocket after a crash. But that always leads to higher monthly premiums. The difference between $500 versus $1,000 out of pocket after an accident isn’t substantial. But you could end up saving money in the long term with a higher deductible.
Put some thought into choosing your deductible.
Put some thought into choosing your deductible. Give some serious thought to going with a higher deductible, especially if you have a history of driving safely. Get quotes for identical policies with both low and high deductibles. Then do some math. How much extra are you paying per year for a low deductible? How many years does it take for extra premium to match the difference in deductibles?
According to Kiplinger, increasing your deductible from $200 to $1,000 could cut as much as 40 percent from your car insurance bill. Doing this also will increase your out-of-pocket expenses if you have a claim. If you shift all or most of those savings to some sort of emergency fund, you should be able to minimize any issues.
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Jerry Hallman Insurance Agency, Inc.
1712 6TH AVE, STE 200
Tacoma, WA 98405
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