There are many factors that affect the cost of car insurance. The type of car you drive your driving record where you live and your age are just a few of the things that insurers look at when setting rates.
One factor that you may not be aware of is whether or not you own your car. It may seem like a small detail but it can actually have a big impact on your rates.
If you finance your car the lender will likely require you to have comprehensive and collision coverage. This is because they want to make sure their investment is protected in the event of an accident.
Once you pay off the car you are free to cancel these types of coverage if you wish. However doing so will likely result in a significant increase in your rates. This is because you will be seen as a higher risk driver without these coverages in place.
If you own your car outright you have more options when it comes to your coverage. You can still choose to carry comprehensive and collision if you feel it is necessary but you are not required to do so. This can lead to a significant decrease in your rates.
Of course there are other factors that will affect your car insurance rates regardless of whether or not you own your car. Your driving record the type of car you drive and your age are just a few of the things that insurers look at when setting rates.
However if you are looking to save money on your car insurance owning your car outright is one way to do it. Talk to your insurer about your options and be sure to shop around to get the best rates.
Is car insurance lower if you own your car?
Yes car insurance is typically lower if you own your car outright.
This is because you are considered a lower risk to the insurance company if you own your car.
How much lower is car insurance if you own your car?
Car insurance is typically about 10% cheaper if you own your car.
Why is car insurance cheaper if you own your car?
Insurance companies view car owners as less of a risk than those who lease or have a loan on their car.
This is because car owners are less likely to default on their payments or drive recklessly.
Does car insurance cover all damages to my car?
No car insurance typically does not cover all damages to your car.
Your insurance policy will have a deductible which is the amount you will have to pay out of pocket before your insurance company covers the rest of the damages.
How much is the typical deductible for car insurance?
The typical deductible for car insurance is $500.
Will my car insurance rates go up if I make a claim?
Yes your car insurance rates will likely go up if you make a claim.
This is because you are considered to be a higher risk to the insurance company after you have made a claim.
How much will my rates go up if I make a claim?
Your rates will typically go up 20% to 30% if you make a claim.
Is it worth it to make a claim if my rates will go up?
It depends.
If the damages you are claiming are less than your deductible then it is probably not worth it to make a claim.
However if the damages are more than your deductible then it may be worth it to make a claim.
How long will my rates be increased after I make a claim?
Your rates will typically be increased for three to five years after you make a claim.
Is there anything I can do to lower my rates after a claim?
You may be able to lower your rates by taking a defensive driving course or by shopping around for a new insurance company.
My car was hit by another car.
Should I file a claim with my insurance company or the other driver’s insurance company?
You should file a claim with the other driver’s insurance company.
This is because their insurance company will be responsible for paying for the damages to your car.
The other driver doesn’t have insurance.
What should I do?
If the other driver does not have insurance you may be able to file a claim with your own insurance company.
However you will likely have to pay a higher deductible.
I was in an accident and it was my fault.
Will my insurance rates go up?
Yes your insurance rates will likely go up if you are at fault for an accident.
This is because you are considered to be a higher risk to the insurance company.
How much will my rates go up if I am at fault for an accident?
Your rates will typically go up 20% to 30% if you are at fault for an accident.
Is there anything I can do to lower my rates after an accident?
You may be able to lower your rates by taking a defensive driving course or by shopping around for a new insurance company.
