Car Insurance Is Necessary, But Which Policy Should You Go With?

Kelly Cooke
Published Jan 7, 2024

Driving is an important part of most people's day to day lives as it plays an indispensable role in their ability to travel, get to work, and make purchases.

Unfortunately, accidents involving cars are very common and the financial ramifications of such instances can be severe. As a result, car insurance is commonly available and very much affordable.

Even if you're inclined not to get insurance, it's the law to get some form of coverage in most states, so if you're going to drive, you're going to need insurance.

There are many companies out there that offer auto insurance coverage with various benefits at various prices.

Here are some things you need to take into account to get the most appropriate policy for your needs.

What Amount of Coverage Are You Looking For?

Not all car insurance policies are created equal. Some contain coverage that vastly outperforms other policies in terms of footing the bill when accidents happen; however, these really good policies come at very high costs, so that needs to be kept in mind.

When picking a policy, it's best to consider exactly what you're looking for rather than just purchasing a plan based on how much it's going to cost you or if a policy simply covers a broad range of things. More isn't always better and purchasing an underwhelming policy simply because it's cheap can be something you'll end up regretting.

Whether you have a really cheap car, a really expensive one, or you're leasing a vehicle should be the primary basis on which you make your policy purchasing decision.

For less expensive cars, acquiring comprehensive coverage, which provides reimbursement for general damage to vehicles in most instances, probably isn't necessary as the high cost of coverage likely isn't going to be worth it,

Most states require a minimum coverage of injury liability and property coverage, which should be enough for most people, but there are other kinds of insurance varieties worth noting, like collision, medical, and uninsured motorist coverage.

One type of coverage worth seriously considering is gap insurance, which covers the difference between the value of a car and the remaining money on a lease.

If you're leasing a car, then gap insurance comes highly recommended as you'll still potentially owe thousands of dollars on your car if it gets completely wrecked, even if the car's physical damage is covered.

What Kinds of Discounts Are Available?

There are numerous insurance policies out there that offer discounts provided certain criteria are met.

Student and retiree discounts are the most basic kinds of go-to discounts you can access, but there are also potentially things based on your driving record and your everyday decisions that can result in a discounted rate, such as consistently not getting into accidents or geting tickets, storing your car in a garage during winter, driving infrequently, and driving an environmentally friendly vehicle (high gas mileage, electric motor, hybrid model, etc.).

Some policies might immediately appear less expensive than others, but if you take discounts into account, it's very much possible the seemingly more expensive policy could actually save you a ton of money.

What's The Company Like?

Policy details and price are incredibly important, but it's best not to forget the importance of the company that oversees an insurance plan.

Lots of things can appear great on paper, but if a company is especially shady or has a lackluster track record, then a rock solid insurance policy might not count for much. Make sure to look up reviews for insurance companies to see if they have good customer service, are consistently reliable, and don't pull underhanded tricks when it comes to claim reimbursement.

Taking a look at a company's history is especially important when it comes to insurance policies that give the impression of being 'too good to be true.' If you find a policy that's really affordable and covers an unbelievable array of different conditions, it's likely you'll find the associated insurance company has a tendency to be very reluctant when it comes to actually paying out claims.

Also, keep in mind that insurance companies base their policy eligibility and prices on various criteria, with credit scores often being referenced. Some insurance companies will look at your credit score and others will not, so that's good to think about when shopping for the best rate.

Getting The Insurance You Need

Auto insurance might seem like something you can easily skip, but it can be a total lifesaver when you really need it. When on the lookout for the best policy, you need to take into account a variety of factors and if you weigh your options well enough, you'll be able to get an excellent policy at a decent rate.

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