A New Year and Time to Do an Insurance Check

The start of a new year is the perfect time to perform an insurance check on your car insurance policy.

Performing an insurance check for the New Year could save you money.

All of us at Car Insurance Guidebook want to wish you all a very Happy New Year! We also would like to suggest that while you are getting your New Year’s resolutions together that you put “Perform Insurance Check” on your list. Over the years we get comfortable with our insurance and it just keeps renewing term after term.

Very few of us actually look at the coverages that we have on our declarations page and think about if they are enough. On the other side, you could also have insurance coverages on your policy that you no longer need anymore.

This is why doing an annual insurance check is important. What better time to do it than at the start of a new year!

Insurance Check #1: Do I Have Enough Liability Coverage?

If you have an insurance policy, you have at least the state minimum requirements. This means that you are driving legally, which is a very good place to start. But, are your liability limits at a place that will really protect you?

There are some states that only require that you carry $5000 in liability property damage coverage and sadly a lot of people carry just what is required. If you think about this though, how many cars do you know of that are only worth $5000? If you are honest with yourself there aren’t too many out there that are.

This means that if you were to get into an accident and total the other person’s vehicle, your insurance company is only going to pay out $5000 of the damages. The rest is coming out of your pocket.

Insurance Check #2: Can I Afford my Deductible?

Placing your deductible as high as you can to get the lowest premium is tempting to do. The insurance companies offer a lower premium for this because the higher your premium, the less money they have to pay out if there is damage to your car.

Can you afford to pay the higher deductible though? If you were in a car accident and there was $7000 worth of damage, if you have a $5000 deductible you are going to have to pay for $5000 of the repairs. Do you have the $5000 available to be able to pay for the repairs?

If you don’t you need to lower your deductible to an amount that you can afford to pay if there is an accident.

Insurance Check #3: Do I Need These Extras?

Rental car coverage and towing are two of the most popular extras that people put on their insurance policy. Unfortunately, many don’t need this coverage because they already have it elsewhere. For example, Toyota offers a free roadside assistance package with new vehicles now that includes towing coverage. So, there is no reason for a new Toyota owner to purchase towing coverage on their insurance policy as well.

Rental car coverage is there so you can have a vehicle while you are without your vehicle due to a car accident. If you own multiple cars though, you already have another vehicle to use in this case, so rental car coverage wouldn’t help you out very much.

During your insurance check, if you find extra coverage that you don’t need; cancel the coverage and save yourself the money.