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Understanding the Basics of Auto Insurance

Car driving on open road with sun setting in background

Sure, you can save big bucks when you switch your auto insurance to another company. After all, there are tons of deals out there – and every offer is better than the next. But saving money is just one of the VERY IMPORTANT aspects of auto insurance. Equally, if not more important, is the coverage. After all, saving a few bucks now will not work out if you get into an accident and the policy doesn’t protect your family’s financial future.

The trick to the right policy is balancing collision, comprehensive, liability, and deductibles along with the monthly premiums.

Let’s start with collision, which covers the cost of repairing or replacing your vehicle if your car is totaled due to a crash. You want to have enough collision to cover the cost of replacing your current vehicle. If the car or truck is more than a decade old and not worth much, you might consider dropping collision coverage completely. However, you’ll be fully responsible for buying a new or used vehicle if yours it totaled.

Next is comprehensive coverage that helps with theft, fire, vandalism, a chipped windshield and more. This is great coverage that doesn’t cost a lot. If you have a car or truck that sits parked for extended periods of time, you might consider just carrying comprehensive coverage. When you go to drive it again, add liability coverage.

Liability is the most important part of any policy. If you are in an accident, and you cause the accident, your liability coverage pays for the repairs to the other driver’s vehicle and any medical expenses that come from the accident. It’s a good idea to carry as much liability as you can afford.

Finally, adjusting the deductible can save you a lot. The higher the deductible, the less the monthly premiums. If you are in an accident, you will need to pay the full deductible before the insurance company will pay their portion. Just be sure you have the cash available to pay the deductible.

Have questions about auto insurance or want to get a free quote, check out the TruStage Auto & Home Insurance Program.

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