The Complete Car Insurance Guide for New Car Buyers
New Car Buyer Auto Insurance
In 2019, the average cost of car insurance for a medium-sized sedan was $1,251.
The range is vast, though. While a single 40-year-old with a clean driving record might pay $1,400 or less per year, a 2-parent family with teen drivers could pay upwards of $3,500 per year.
New Hampshire and Virginia are the only states that don’t require drivers to purchase car insurance. However, residents are still responsible for damages incurred in an accident. If you can’t pay, your driver’s license and registration will be suspended.
First time car insurance can be daunting, especially if you don’t know what to look for.
From purchasing collision insurance to filing a claim, this guide will tell you all you need to know about first time car insurance.
What Do You Need to Purchase Car Insurance?
In Massachusetts, purchasing car insurance is something you must do before you drive off the lot.
Buying first time car insurance can be overwhelming, but once you know and understand all the elements involved in an insurance plan, you’ll have peace of mind taking control of what you’re paying for.
For first time buyers, insurance rates tend to be higher, regardless of age. The reason for this is simple: new drivers lack the experience that veteran drivers have.
It’s important to not only go with a great provider but to shop around for different rates, too. Be sure to begin your process before you go car shopping to get a better idea of what you’ll be paying based on the vehicles you’re interested in.
Gather Your Documents and Information
There are some key documents you’ll need, even as you shop around and explore different rates. To save time while you’re checking rates online or talking to an insurance agent, make sure you have these things ready:
- Vehicle information (VIN, license, year, make, model, etc.)
- Personal information (social security number, driver’s license, etc.)
Having your bank information can help, too, especially once you find a great rate and want to lock it in. Plus, most insurance providers offer significant discounts to those who pay via automatic monthly withdrawal.
While you’re shopping, get a quote from at least 3 different insurers so that you recognize a good offer when you see it.
Which Insurance Options Are Essential?
In the event of theft, an accident, or any other incidents, there are some coverage options you must have to ensure all your bases are covered.
In most states, auto liability coverage is mandatory. The law dictates the state minimum that is required of drivers to purchase. Beyond that, it’s your choice as to whether or not you’d like to purchase more.
There are 2 components to liability:
- Bodily injury liability
- Property damage liability
Bodily injury liability helps to pay for costs related to physical injuries suffered by other parties.
Property damage liability can help pay for damage caused to someone else’s property while driving.
Underinsured and Uninsured Motorist Coverage
If someone else hits you, but they don’t have enough insurance or any at all to cover the cost of injuries and damages, then uninsured motorist coverage will protect you. While it’s not mandatory in Massachusetts, it’s highly recommended by every insurance agent.
Say you’re hit by a driver who doesn’t have any vehicle insurance, and you end up with a hefty pile of medical bills. Your uninsured motorist coverage can help.
If you get into an accident with another vehicle and hit other property like a fence or a pole, collision coverage should help pay to either repair or replace your car.
When you get paid to replace your car, it’ll be based on the car’s actual cash value minus your deductible.
Typically, collision coverage is optional. It may, however, be required by your car’s lender or leaseholder.
The state of Massachusetts doesn’t require collision insurance. However, you can protect yourself from monetary loss with collision insurance if you own any valuable assets.
Comprehensive coverage is another example of coverage that’s usually optional. Again, your lender or leaseholder may require it, though.
If your vehicle sustains damage due to theft, hail, or vandalism, comprehension coverage could help to either replace or repair your vehicle. Like other coverage options, you’ll have to pay your deductible before you receive reimbursement for your claim.
Personal Injury Protection
Personal injury protection is only available for drivers in certain states. It can help you pay for medical expenses after an accident.
Plus, it can also help to cover additional expenses in the event of an accident with sustained injuries. For example, if you need help with child care expenses or your accident results in lost income, personal injury protection can help.
In some states, like Massachusetts, personal injury protection is required. In other states, it’s optional.
Medical Payments Coverage
If you, your family members, or your passengers who are driving your insured vehicle get injured in an accident, medical payments coverage is what will help to cover costs associated with their injuries.
If the driver has injury costs like surgery, X-rays, and hospital visits, medical payments coverage will help cover those costs.
Just like personal injury coverage, medical payments coverage is required in some states and optional in others.
If you live in a state where all 6 of the aforementioned coverage options are available, don’t hesitate to add them to your plan.
What Other Types of Auto Insurance Coverage Are There?
When you discuss insurance rates with an insurance agent, they’ll know exactly what’s required in your state. Likewise, they’ll be able to give you recommended minimums and help you figure out what additional options are smart choices for your plan.
There are additional coverage options that many drivers choose to add to their policy, all dependent on their situations. For example, towing and labor cost coverage is one option. However, you might not need it if you live with your parents, and they already have a coverage plan for towing costs.
Here are some additional coverage options many drivers opt to add to their policies:
- Rental reimbursement coverage
- Gap coverage
- Towing and labor cost coverage
- Sound system coverage
- Ride-sharing coverage
- New car replacement coverage
- Classic car insurance
If you can, eliminate what you don’t need but get the coverage at least a step above the state’s minimum. In the event of an accident, some states will garnish your wages to cover what your insurance won’t.
If you ever find yourself in a car crash, don’t panic. Accidents are stressful both during and after the event, even when it’s just a fender bender. Here are the steps to follow should you get into an accident.
What Affects Vehicle Insurance Rates?
To calculate insurance premiums, insurance companies go through an “underwriting” process. Insurance agents use your personal information (like location, age, make and model of your car, driving history, etc.) to determine what you’re premium will be.
The more likely they deem that you’ll file a claim, the higher your rates will be. For example, someone who has just learned to drive and owns an expensive car will have a much higher premium than someone with a longstanding safe driving record.
Let’s take a look at all the factors that may affect insurance rates.
- Coverage levels
- Driver history
- Age and gender
- Credit score
- Your vehicle
- Safety features
The higher coverage levels you get, the more protection you’ll have. However, they also cost more and aren’t always necessary. Talk to your insurance agent to find out what works best for you and your situation.
Your driving record plays a significant role in calculating your premium. The better it is, the better your rate will be. Plus, things like where you live, your age and gender, and your marital status can all influence what you pay for car insurance.
Ask your agents what discounts can be applied to your policy and if there are any that you can work towards. When you shop around, be sure to ask for the same coverage levels and discounts from each provider. It’s important to compare quotes for plans that include the same coverage and discounts so that you can pinpoint the best deal.
Don’t Forget to Think About Your Deductible
Your vehicle insurance deductible is the amount you must pay toward repairs BEFORE your insurance will cover the rest.
For example, say you’re in an accident that causes $5,000 worth of damages to your car, and your deductible is $500. That means that insurance won’t pay you or the auto shop for the $4,500 worth of damages done to your car until you FIRST pay that $500 deductible.
The higher your deductible is, the lower your premium will be.
Remember, it’s crucial that you don’t put yourself in a position where you can’t afford to fix your car. Some people opt to pay a higher premium with a lower deductible, like $250. They like the peace of mind knowing that if something happens to their vehicle in an accident, they won’t have to shell out more than $250.
Create a car insurance policy shopping checklist to use while you shop around to ensure you cover all your bases!
Important Details to Remember
The primary purpose behind shopping for insurance rates is, of course, to save money. It’s also essential, however, to work with a reputable insurance company.
Purchasing insurance through a private agent is the best way to make sure you’ll be taken care of, both now and in the future. If you ever have to go through the process of filing a claim, you’ll be thankful for excellent customer service and attentive insurance agents. The last thing you want is to be left hanging or feeling like you’re being ignored.
Don’t add any coverage you don’t need, either. For example, if you have a car you can use in the event of an accident, there’s no reason to have rental-reimbursement coverage incorporated into your premium.
How to Keep Your Premiums Low
Once you’re driving, there are a few things you can do to keep your premiums low and strive for more discounts in the future.
Always drive safely and do everything you can to avoid tickets and accidents. Be sure you’re getting every possible discount. It’s a good idea to call in once a month and check with an insurance agent to see if there’s anything else you can do to save money.
If your car is equipped with safety features, like anti-lock brake systems, anti-theft devices, and airbags, make sure you get any available discounts for those, too. Always pay your bills on time to keep your credit history positive. Most states will give you lower rates for good credit.
If you’re a new driver, find out if any discounts become available after you’ve been deemed a “good” and “safe” driver for a certain period of time.
Another area to check for savings is by bundling. For example, if you also need renter’s insurance, sometimes bundling the 2 or more policies will get you a better deal. Bundling home and auto insurance in Massachusetts can save you a significant amount of money.
Think about your car before you buy it.
Certain brands and types of vehicles are more expensive to insure. You can still shop with your personal information ready and ask how premiums would change based on different car choices.
If there are a few particular vehicles you’re considering, have the make, model, and approximate years written down so that you can get a ballpark idea of insurance rates offered for those specific vehicles.
Get the Right Coverage for Your First Time Car Insurance
If you’re shopping for first time car insurance, don’t be overwhelmed. While premiums can be higher for newer drivers, there are plenty of ways in which you can use discounts to lower your premium insurance rates.
It’s important to save money, but it’s just as essential to get coverage through a provider that demonstrates excellent customer service and knowledgable insurance agents.
Do you want to make sure you save money and get the best first-time car insurance? Contact us with any questions or concerns so that we can help you find the best plan!
See How Much You Can Save!
To learn more about how you can save on car insurance. Get in touch with the independent agents at LoPriore today. Our experienced insurance agents are available 24/7 to answer your questions, provide information about our auto insurance policies, or provide you with an instant quote.