Renewing an Insurance Policy
Every year, people will need to renew their car insurance policies. At this time, the insurance company will give their clients a new quote. Typically, insurance companies look for reasons to raise their client's rates at this time and they usually find it. As a result, every time people renew their auto insurance, they will be accepting a higher rate.
What people need to know is that the newest clients will be the ones who are quoted the lowest rates. This means that their established clients will be paying more for their insurance even if they do not really deserve this treatment. It is worth it to take the time to shop around for car insurance with other companies to find out if they will be charged lower rates by these other companies than their current companies are charging.
Insuring a Teenage Driver Under the Parent's Name
This is a kind of insurance fraud that can be much more costly to the parents after they have been found out. It happens when a parent insures their teenager's cars under their names. Since the teenager is the primary driver, this is not a legal thing to do. The parents may have a serious fine levied against them and their teenagers can also suffer some consequences; teenagers have been known to lose their driving privileges for being involved in this scheme.
Purchasing Less Insurance Than Needed
In order to keep premiums low, some people will opt to only purchase the required minimum amount of liability insurance. This leaves their own vehicles completely unprotected from car collisions, being stolen or being vandalized. It would be a good deal for an older car and is even recommended that people not purchase comprehensive and collision coverage for older vehicles, but for a new or expensive vehicle this would be a travesty. Unless car owners have the means to replace their cars on their own, they would do better to try to save money on full coverage policies by comparing quotes from different companies.
Raising the Deductible Too High
People will be motivated to raise their deductibles from $250 to $1,000 to lower their insurance premiums, but this figure may be too high. Such a high premium will mean that the savings will only be $54 for the year. This may not be enough of an incentive to increase a driver?s risk by raising the premium to $1,000. If an accident occurs during the first year, the driver will be responsible for the entire deductible. Saving $54 may not be such a good deal when compared to how much will be owed for the deductible.