Basics Of Auto Insurance Coverage: What You Should Know

Posted on: 3 April 2019

As a new car owner, one of the biggest challenges that you are going to face is securing insurance so that you can register the car. Especially if you've never had insurance before, or if you've had very little experience with it, you may believe some of the most widespread misconceptions surrounding that coverage. Here are a few important things that you need to know.

Comprehensive Coverage Doesn't Cover Your Belongings

You may have heard that comprehensive coverage is valuable because it will help to replace your belongings if they are ever stolen from your car. This isn't actually the case. Comprehensive coverage will only reimburse you for items that are actually affixed to the car or installed inside. Anything of yours that you can easily remove from the car won't be covered under the policy.

You can, however, get coverage for these belongings (like clothes, music discs, memory cards) under your renter's policy or homeowner's insurance. Just make sure you understand the personal possessions coverage under the policy to be sure of what is and is not covered.

There Are No Guaranteed Rate Adjustments

You may have heard that your insurance rates will drop automatically at certain times, such as when you turn 21 or 25, or when you get married. The truth is that this isn't a guarantee. Every auto insurance company has their own premium adjustment periods, so you'll need to clarify the rate reductions and their timing with the company that you choose to work with.

You Won't Pay More To Work With An Agent

Some people believe that when they work with an insurance agent instead of contacting a major insurance company directly, they will pay a premium higher than they might otherwise. The fact is that there's little difference in the premiums from an agent's office compared to that of a major insurance carrier directly. In fact, sometimes working with an agent means that you get discounts that you wouldn't otherwise have because they can offer you deals that you can't get elsewhere.

You Can Change Policies At Any Time

It's a common misconception that once you secure a policy, you're stuck with that coverage until the policy is due for renewal. The truth is that you can change your policy at any time. You don't have to wait for renewal time. In fact, if you cancel your existing policy for a new one, the insurance company will typically refund the prorated amount remaining on your premium.