Reader question:
I’m going to get a used car, but since I’m thinking about money, I just wanted to find out what I should keep in mind if I want to get cheap car insurance quotes.
Allen
Great question.
Most people who get used cars are trying to save money in some way and at the same time, considering they are spending so little money on their car, find it a burden to be wasting so much on car insurance for a car that isn’t worth much anyway. Luckily, older cars tend to get cheaper car insurance premiums than newer cars, but the difference does little to help people who are driving clunkers and still getting charged high rates.
It should be understood, first of all, that at least liability insurance is required in practically every state in the U.S., so going without insurance on your used car just isn’t an option. Just because you have to have some insurance, though, doesn’t mean you have to have the same amount as though you had a new Mustang. You’ll admit it to yourself that you’re car is important to you, but you don’t need to make sure that if you get in a wreck they replace your six-speaker stereo and DVD navigation system. Not needed, right?
So in order to lower your prices, cut the coverage. In some states you are required to get medical and uninsured motorist coverage, but if your state isn’t one of them, don’t worry about, especially if you already have health insurance. If you don’t have health insurance, though, it’s probably a good idea to keep the medical on. Also, you probably don’t need collision or comprehensive insurance for your used car. The nature of a used car is that it wears out much faster than a newer car, so you’ll probably be buying another in just a few years anyway–why spend so much on coverage for what is in essence a temporary car?
Finally, if your car costs less, or even just slightly more, than your premium? Cut down to the absolute minimum required by state. If you’re going to be paying more for your insurance than you paid for your car, you might as well have gotten a better car, right?
Cheers,
Fashun Guadarrama