These policy considerations may seem minor, but being aware of them may save you time and money.
Moving From One State to Another
If a job change or circumstance requires you to move from one state to another, you'll likely have to revise your auto insurance.
Forget the notion that you are going to start over in a new spot with a new insurance company and leave behind a troubled driving record. In this era, any company will likely turn up your record from the Department of Motor Vehicles in your former state.
Moving from a conventional insurance state to one with no-fault insurance could mean sizable changes in your policy. When adopted in the early 1970s, no-fault laws were intended to sharply reduce the number of lawsuits, and thus reduce auto insurance premiums. It hasn't worked out as intended. Many no-fault states have insurance rates just as high as conventional states' rates.
|States With No-Fault Insurance|
Source: Insurance Information Institute
With no-fault policies, damages aren't collected from the at-fault driver's insurance company. So each motorist must carry personal injury protection to pay individual medical expenses and lost wages. Even if an accident involved an out-of-state driver from a conventional insurance state, the PIP provision in the home-state motorist's policy probably would kick in to cover any injuries.
Your insurance agent or direct-sales company is likely to offer other small add-ons. Rental-car reimbursement may be worth it if you have just one vehicle. If your family has more than one, you may be able to skip paying for this coverage. Likewise, roadside-towing insurance is unnecessary if you already belong to the American Automobile Association or some other auto club.
Insurance for Leased Cars
If you are leasing a car or plan to lease, be sure you have gap insurance. This covers you if your car is totaled and the leasing company demands more of a payback than what your auto insurer is willing to pay. The best time to get such insurance, by far, is when you initially lease the car. Most major leasing companies and automakers finance subsidiaries, such as General Motors Acceptance Corp., offer such insurance as part of their leases.
|Infrequently Asked Questions|
|Here are some factors you may not have considered that could affect what you pay for auto insurance.|
|Factor||What You Need to Know|
|Is it me or my car that's insured?||You carry your policy with you when, for example, you rent cars — provided your coverage includes collision. If so, refuse the offer from the rental company of the expensive add-on collision coverage.|
|How can my spouse, significant other or business partner affect my insurance rates?||If someone listed as a regular or occasional driver on your policy has a poor driving record, it will push up premiums. Sometimes, just having a roommate with a poor record who turns up as an address match in the computer can push your rates up even if you never loan out your car.|
|What if a friend borrows my car and gets into an accident?||If he or she isn't listed on your policy and gets into an accident with your car, your insurance carrier may consider this so-called permissive use and cover the damage. However, you should ask your insurer about this before lending someone your car keys.|
|Does the insurance company pay me directly if I file a claim?||That depends on the company and the claim. If your car needs body work, the insurer might pay the body shop directly — especially if the company has a preferred network of shops. If your car is totaled, you are more likely to get a check directly.|