When you’re buying an auto insurance, you go through hundreds of companies, leaf through endless stacks of papers, talk to a lot of friends and relatives. You may even consult an agent. But despite all your efforts, you may still miss out on a few things. Your insurance company won’t tell you the entire terms and conditions of your insurance.
That’s why we’ve compiled a list of seven things you should know that your insurer will not tell you.
The documents they refer
If you hand over the responsibility of buying an auto insurance to an unreliable agent, you may not know what documents your insurer is looking at before selling you an insurance. You’d think your driving record, credit history, and good word would be enough to get you an insurance. But often, your insurer may want to look into other documents like the following.
- Your mileage reports
- Your vehicle registration
- Other potential drivers of your car
- Your homeowner’s or renter’s insurance documents.
Which claims they reject
When you purchase an insurance, you may not know under which situations you can claim your insurance. For instance, your insurer won’t tell you that they don’t cover intentional damage done to your vehicle. So even if your angry friend runs your car off the road to get back at you, he would have succeeded. Because such damages to your car are considered intentional and your insurer will not help you recover your damages. Other intentional damages include damages you inflict on your own property while road racing, wear and tear, etc. Your car insurance doesn’t cover theft of personal belongings in your car either. You have to get a comprehensive insurance for that.
You may claim for diminished value
If you’ve met with an accident, the value of your car would be much less than a new car of the same model. It doesn’t matter how well your car was repaired, it still would value less than before. But your insurer won’t tell you that in 14 American states, you can claim that lost value. It’s called diminished value. However, you should know that in Washington D.C and 36 other states, it’s legal for insurers to exclude diminished value. So if you live in any of these states, you might not be covered. But in the states of Virginia, Kansas, Georgia, Louisiana, Maine, Maryland, Hawaii, North Carolina, South Dakota, Massachusetts, Florida, Washington, Texas, and West Virginia, you can get a diminished value payment.
Official cancellation terms
When you purchase an auto insurance, most insurers will tell you that you can cancel your insurance anytime with just a notice in writing and a closing date. And so, if you think you can close your policy at the end of the coverage period and ignore the bill, your insurer will send you another bill for the next premium and if you don’t pay up, they’ll cancel you for nonpayment – which will affect your credit score. Therefore, if you decide to cancel your insurance, call your insurer and clear up any doubts about the date of cancellation. Only then will your insurer send you a cancellation request. It’s often a pre-filled form and you have to check through the details and sign. Remember, you might also have to prove to your old insurer that you have a new insurance.
You bear losses if you loan your car
Your insurer will never tell you insurance conditions like the effects of loaning out your car. Know that if you lend your car to friends and they crash it, you will have to claim insurance and you’ll have to bear the extra deductibles. Also, your insurance rates will increase after such incidents. Plus, if your friends were in an accident driving your car, in addition to bearing the loss to your car, the injured party may also come after you for medical claims. However, if your car was taken without permission or your knowledge, you won’t be liable for the losses.
Total loss is not your friend
Most of the time, if you’ve been in a bad accident and your car is too damaged, your insurance company may advise you to claim for total loss. Though this is inevitable in most cases, what your insurer won’t tell you is that you might get back far less than what your vehicle is worth and less than the cost of buying a new car. Also, insurance companies often prefer to total your car, because it’s cheaper than repairing serious damages.
Where you live matters
Some insurers may even tell you that you can get a car insurance no matter which area you live in. But this is often not true. Where you live matters a lot. Some areas are more prone to theft and accidents and if you’re from such an area, you may have to pay a higher premium than most people living in areas of fewer crime rates.
Before you buy an auto insurance, it’s important to understand what you’re getting yourself into. Analyze your insurer thoroughly before you make the final call. And if you need any help, we’re always there to help you get the best auto insurance, at the most affordable rates. Just give us a call and we’ll make sure you get a clear picture of the insurance you’re buying.
- How did you choose your auto insurer?
- Did you face any unknown issues while claiming your insurance?
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