Pontiac Car Insurance
Chances are as a Pontiac resident, you know your cars. Maybe you or your family work at a plant, as an engineer, or in the upper offices at one of the big automakers.
Car insurance, now that is more of an enigma, even for you.
Whether you feel like you have seen it all from the insurance companies, buckle in to learn about tiny little insurance secrets that cost you money.
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Loyalty Does Not Have Rewards
The first on the list of many fallacies is that sticking with what you know is a good thing.
If you have been with Insurance Company A for decades, you probably are overpaying for insurance. Overpaying is what happens when you stick with the same insurer for too long.
You may have decades without any accidents, moving violations, or tickets, but are still paying more than your son, who has a more-than-imperfect driving record.The number one misconception among insurance customers is that longevity, dedication, and loyalty are rewarded with lower insurance premiums.
The opposite is often more likely the case. As the years pass, you renew rather passively, accepting small increases in your insurance, without realizing it.
The insurers take advantage that you are lulled into a sense of complacency. They give alluring, super-low premiums to new customers, hoping to lure them away from their old carrier.
Who foots the bill for such low rates? You, who has dutifully paid your premiums with Car Insurance Carrier A for four decades.
You Read It On The Internet
The Internet is known across the board for one commonality -- inaccurate information.
Whenever you are shopping for insurance, be wary of overly zealous pundits who promote underinsuring yourself in order to save $100 per year on insurance costs. The interesting part of this point is that even big media outlets are guilty of giving out shoddy insurance "savings" information.
Sometimes the suggested limits that your insurance company provides are flawed too.
Now, for people working in the auto industry, this may be a moot point, but there's much to be said for keeping collision and comprehensive, no matter how old your car is.
Again, you may never have kept a car for more than five years because you have the perk of trading up or buying new at such a great savings.
Just in case you keep an old beater, sometimes that collision and comprehensive coverage is a life saver. Let's say you have $3,000 in a rainy day fund. Get real, it's Michigan, so it is your cabin fever fund.
It is the money that flies you to Florida for a couple weeks when you feel like you might die if you see one more snowflake. Now, you slide your beater sideways into a truck, who gets slammed by another vehicle. It is a snowy, icy mess, and sometimes accidents happen.
You gave up the insurance on your old beater, so you need to buy another car. Now you have a down payment for a car, $3,000, but you are definitely over the snow after that accident.
The damages are $3,000, of course. If you had collision coverage, you would have paid your deductible and your insurer would pay for the repairs. If it is more than your car's value, you would still have a parting gift -- something to show for your insurance.
Maybe you could go out and replace the old beater with another old beater and still go on vacation.
Insurance industry statistics show that most drivers have one accident per decade. A majority of those accidents will incur the following average expenses:
- Approximately $3,000 in damage to your vehicle
- Injuries of approximately $14,000
Of course, always work to minimize the risk of an accident and take precautions to minimize property damage and injuries.
- Wear your seatbelt
- Insist on any passengers in your vehicle wear their seatbelt
- Never drive under the influence of drugs or alcohol.
- Do not use a cell phone while you are driving. Even a hands-free set keeps your mind in a separate space, where the conversation takes your attention away from the road.
- Never text and drive
Even today, wearing a seatbelt, driving cold stone sober, and not using the cell phone at all are the best ways to stay safe.
It's Not All Lost
The real issue with the advice to dump collision and comprehensive is that many times repairs are much lower in cost than you might assume. Most accidents are not going to total the car.
That is the number one argument against the insurance industry, well-meaning insurance writers, journalists, and frugal betty's bloggers who vehemently state "'tis better to save the premium than to buy collision or comprehensive coverage."
You might find at worse, an average of $3,000 in damage to the car, on average. That in itself makes insurance worth the cost.
You do not buy insurance for "average" events but for emergencies and catastrophes. Heavy machinery, 18-wheelers, distracted drivers, snow, and ice all make for big-time injuries and potential damage. You need to be prepared for lost limbs, brain damage, and a life that is changed forever.
Michigan has three types of collision portions for your policy:
- Broad Form requires you to pay a deductible only if you cause the accident. It pays damages without regard for fault.
- Standard collision pays out without regard for fault.
- lLimited collision pays when you are not "substantially at-fault", with the presence of a deductible entirely up to how you arrange your policy.
Insurance is not intended to pay for a scratch to the underside of your rubber bumper.
It is intended to ensure that you have the money to pay for damages and injuries. Car insurance is not meant to cover all of your needs. There is a good combination of products you may want to consider to round out your coverage.
You have to factor into your own personal equation when buying insurance whether you have the following, at what levels:
- Health and medical coverage
- Savings
- Life insurance (to cover funeral costs)
- Disability insurance to cover if you cannot work (do you have occupational specific coverage or general)
However, in Michigan, you may get more out of your insurance policy because it is a no-fault state, and requires drivers to carry something called Personal Injury Protection, or PIP insurance.
This pays out for medical, rehabilitation, and often times lost wages. This is one area on which to focus a good deal of your attention when purchasing a policy, especially if you do not have a good deal of life insurance, disability, or health insurance.
Bodily injury liability and property damage liability protect you if or listed drivers on your account cause an accident that results in injuries or death of other drivers and their passengers, or if it causes damages to other people's property.
State minimums are typically too low, though Michigan requires a minimum of $20,000 minimum bodily injury liability and $40,000 for every accident. The money gets split among all victims.
If that does not sound like a lot of money, you are right. In fact, if the injured need more money they may sue you for damages and injury. The state's minimum property damage is also low because $10,000 could barely cover the cost of an economy car.
However, again, because Michigan has no-fault insurance, you may be better off with the added benefit found through PPI, or Property Protection Insurance. You are still obligated to carry $10,000 minimum in property damage. Though, the required PPI covers you against damages you cause up to one million dollars.
A good repository for general information is straight from the Department of Insurance and Financial Services
Weigh Insurers
Hold the results of a quote side-by-side. Discard any insurers who have a bad reputation for dragging its feet when it should pay out claims quickly. Ensure the insurance companies have the funds to pay claims.
Check out A.M. Best for more on credit worthiness. In addition, make sure that you have the limits you want for your insurance.
Buying insurance is a serious responsibility worth your consideration. Take the time to evaluate your personal situation.
Compare quotes to find the best policy at the most competitive price. Make sure you listen to your needs, and not be too taken by what you read on the Internet.
Simply enter your zip code below to compare quotes from multiple car insurance providers now!