Car Insurance: 4 Things the Insurance Company Doesn't Want You to Know

We all need car insurance, the law requires that you have car insurance before you can drive on our highways. What the law doesn't require, is that you have more insurance than you need. How much Insurance that you purchase is open to interpretation. Let's cover some of the variables involved in keeping your car properly insured. Here are four things that the insurance company doesn't want you to know.

1. Car insurance companies know that people usually don't keep up with the present values of their automobiles. Do you know how much your car is worth today? It doesn't matter what you think it's worth, the insurance company goes by the Book Value. You should know what your car is worth in today's market. There are guides like Kelly's and Edmond's that give accurate appraisals of what your car would fetch. Auto prices are also different in various regions of the country. You can find what your car is worth on the Internet. Just type in used car prices on your favorite search engine. Another thing that you should know is that there are usually three categories of prices in these guides. Insurance companies usually payoff for the lowest two categories. There is no such thing as excellent condition to the insurance company.

2. One thing the insurance company has that you don't, is statistical data. Basically, insurance companies are betting against you. You are betting that you will have an accident. The car insurance company is betting that you won't have a claim. Their statistical data is usually in their favor. Think back about your past driving history. If you're an average driver, you don't have many accidents. If you do have accidents, your insurance company usually drops you. Total up how much you have spent on car insurance over the years and it may make you cry.

3. Now that you know how much your car is worth should you continue to carry collision and comprehensive insurance? If you are still making car payments, you have no choice. You have to have the mandatory car insurance. Your lender requires that. If you own your car outright, and it isn't worth more than a few thousand dollars, you would be better off dropping expensive coverage. A better strategy would be to carry just liability insurance. You can save the extra towards the purchase of another vehicle in the future. Make sure that you take the deductible you chose into consideration. Some people wisely choose the deductibles of $500 or more. So having a $2000 car with a $500 deductible and still carrying collision and comprehensive isn't practical. Save your money and just get the liability insurance. Put the savings in the bank.

4. The insurance company knows that people are lazy. They also know that people generally don't shop around. Here's where you can outwit them. Look on your insurance policy and find out when the insurance expires. A month or two before hand start calling other insurance companies. Get bids for your insurance. There can be large differences in prices from company to company. Getting three or four or five competitive bids can save you a lot of money. Obtaining competitive bids should apply to any insurance that you purchase. Outfox the insurance company and shop around.

Look into investigating the various factors concerning your car's present value and how much you can save by dropping expensive collision and comprehensive coverage. Get competitive bids. Shop around. Take the money that you saved and put it away for your next vehicle. Money not spent on car insurance is money saved.