Advice for first-time car insurance buyers

By KATIE FISCHER

When a young adult goes off to college for the first time, they look forward to having more independence. However, that independence comes at a price. A financial burden on young students that many often forget about is that of car insurance.

While some students chose to keep their vehicle on their parent’s insurance policy, many chose to strive for independence and purchase their own.

Buying car insurance for the first time can be a tricky game. From deciding what kinds of coverage you will buy for your car, to what company you chose to purchase from, there plenty of mistakes that a first time, inexperienced buyer can make.  There are plenty of measures that can be taken to prevent some of these mistakes from occurring.

Where do you start when beginning the shopping process for car insurance? Insurance agent Janet Tidwell, who has 20 years of industry experience, says a good starting point would be to figure out what is on their Motor Vehicle Report.

“Having a copy of their MVR is helpful as it reflects the exact dates of accidents and violations. This will prevent a big surprise in price discrepancy when they are ready to purchase their insurance,” Tidwell said.

Tidwell also advises that it is a good idea to make sure that your driver’s license is up to date and that it has not been suspended, which could lead to your insurance rates being higher.  A buyer also needs to know other information such as the VIN number of the car you are looking to insure. This way, when you give the number to the agent who is quoting you, they will be able to automatically get information on your car like make, model, and year.

When you have the necessary information ready, the next thing a first time buyer needs to understand is the different types of coverage that are available for you to purchase for your car. The three typical types are liability coverage, collision coverage, and comprehensive coverage. Liability coverage will cover you in the event of a vehicle accident where you are at fault, while collision coverage will cover you if you are in an accident that is not your fault. Comprehensive coverage will pay for your car if something happens to your vehicle that is not traffic related (i.e. weather, theft).

David Tidwell has been a fully licensed agent with ALFA for 30 years in the Atlanta area and offers up some advice as to which coverages young drivers should add to their policy.

“Purchasing liability only, puts the driver at risk for not having enough coverage,” Tidwell said. “It may still be wise to carry comprehensive and collision coverage even if the vehicle is older and paid off.”

When you know what coverages you want for your vehicle and you begin contacting companies for quotes, there are a few things to remember. If you are a driver who is under the age of 25, you are considered a “high risk” driver; your rates will be higher.

“Drivers under 25 are considered  ‘high risk’ as they statistically have more accidents and moving violations than older, more experienced drivers,” Janet Tidwell said.

These higher rates are what cause many young drivers to remain on their parents’ car insurance policy until they are 25.

“It is often more economical to remain on their parents’ policy as long as they are a student or dependent,” Tidwell said. “The parent may have been insured with the same insurance company for many years, therefore earning longevity discounts, multi-car discounts, and homeowner discounts that the student may be able to take advantage of.”

Tidwell also reminds buyers to never be afraid to ask questions since you need to feel comfortable with making a financial decision of this magnitude. Purchasing car insurance for the first time can be a daunting task, but if you prepare yourself and do proper research, then you will know what to expect and have a far less stressful experience.

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