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Car insurance can be difficult to understand. When you’re trying to select a policy, you may be wondering if a policy with comp and collision is best, since this can provide financial protection if you’re in an accident. You should also know how much liability should be on your policy and decide whether uninsured motorist coverage is best for you. Once you decide on the right insurance policy features, it’s possible to become confused again once you see the bill, especially if you’re recently been in an accident.
Talking to your insurance company can be tricky because insurance claims adjusters will try to convince you to accept the lowest offer possible if you were in an accident and are filing a claim. There are also a few other things your insurance company may not want you to know. Here are some details that will help file a settlement successfully and choose the insurance policy that is right for you.
Car Insurance Isn’t Always Connected to the Driver
Your car insurance is technically tied to your vehicle. This means if you let a friend or family member drive your car, your insurance will likely be in effect if there is a wreck. However, not all insurance policies cover all uses for your car. Be sure you read the fine print before you let someone else drive your car.
Your Driving Record Affects Your Insurance
Every time you file an insurance claim, and even if you inquire about making a claim, these details are entered into a database for other insurance carriers to see. This is one of the ways insurance companies try to downplay the validity of your claim and offer you less money, even if you have a good reason for making the claim. If you’ve been involved in an accident before or have traffic tickets on your record, your insurance policy will likely be higher than someone with no strikes on their driving record.
Where You Live Affects Your Insurance Premiums
The state you live in could affect the cost of your insurance. The average premium in Michigan was 64% higher than the average in the U.S. in 2018. Other states with high car insurance premiums include Florida, Rhode Island, Louisiana, and Connecticut. States that offer insurance premiums in the average range include Iowa, Ohio, Vermont, and Idaho.
Your Credit Score Could Affect Your Car Insurance Payments
In most cases, your credit score is one of the factors used to determine how much you’ll pay for car insurance. Hawaii, Massachusetts, and California are the only states that don’t use your credit score to determine your policy payments. The Federal Trade Commission asserts that people with lower credit scores are viewed as a greater risk than those with average or high scores. Individuals with lower scores will likely be charged more for insurance to cover any expenses if you have a file a claim in the future.
You Can Double-Check Your Insurance Reports
Your insurance information can be found on two databases: The Automated Property Loss Underwriting System (A-PLUS) and the Comprehensive Loss Underwriting Exchange (CLUE). Verisk Analytics runs A-PLUS and LexisNexis is in charge of CLUE. These databases keep a record of any claims you file, and the claims stay on your report for five to seven years.
According to the Fair Credit Reporting Act, you can receive a free copy of your report once a year. If you see anything that is incorrect or inaccurate, you can file a dispute. Asking for a report won’t affect your credit score.
These are important things you need to know to ensure you’re not paying too much for car insurance. You also need to keep these factors in mind if you have to file an insurance claim after being involved in a car accident. It’s best to consult an attorney if you’re filing an insurance claim to ensure you receive a fair settlement for medical costs and damage to your vehicle.
