Should You Tune Up Your Auto Insurance Policy?

By BankingMyWay.com Staff
Your car gets regular maintenance … oil changes, tire rotation and engine checks, but what about your auto insurance policy?

Once you buy an auto insurance policy, you may feel like you’ve done your due diligence, but your insurance coverage needs regular maintenance just like your car. As the circumstances in your life change, so too should your level of coverage. Additionally, you may now qualify for discount programs that you didn’t before. In order to make sure you get the appropriate level of coverage at the best price, you should “tune up” your policy once a year.

Here are some things you should consider when updating your auto insurance:

Has your family makeup changed?

If you have gotten married since you bought your policy, you’ll need to add another driver. Conversely, if you got divorced, you can take your ex-spouse off your policy. If you have had children, you’ll need to update your number of dependents for personal injury protection purposes.

Is your teen driving?

If your teenage child got his/her license and will be driving your car, you need to adjust your policy accordingly. This can increase your premiums significantly, but failing to do so can cost you dearly if your child has an accident, especially if someone gets hurt. On the other hand, if your child goes to college or leaves your house, you can save on your premiums by removing him/her from your policy.

Has your work situation changed?

If you started your own business and are now using your car for business purposes, your policy needs to reflect that. Additionally, if you move closer to work or started using public transportation, you may be able to get any surcharges for daily commuting taken off.

Has your economic status changed?

If you’ve gone up on the financial ladder, that means you now have more assets to protect. You may want to look at increasing your liability coverage or adding an umbrella policy to your insurance. Alternatively, if you find yourself with less money to pay your insurance premiums, you might want to lower your coverage level. It’s wise to buy as much car insurance as you can afford and as is appropriate for your needs, but if your premiums are causing you financial difficulty, temporarily scaling your coverage back to legal minimums may help ease some of the hardship.

Do you need comprehensive and collision coverage?

If your car is old and is no longer worth a lot of money, you may want to drop your comprehensive and collision coverage. These features cover damage to your car, but they may not be worth their cost if your car is not worth much.

Are you getting all the discounts you can?

Most car insurers will discount your premium for having multiple cars or other policies with the company. If you consolidate all of your insurance coverage at one company, you can probably save. Additionally, if you have been with a company for a long time and/or have a good driving record, you may be able to get more discounts. Find out all the programs your insurer offers to see if you can qualify for any.

Finally, ask yourself if your auto insurance company is the best one for you or if you can save by switching to another company.

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