Does the Cheapest Vehicle Insurance Give Good Coverage?

Vehicle insurance is the insurance that covers the damage to your vehicle. Getting the cheapest vehicle insurance is tricky, since many providers peddle deceptive claims that either don’t amount to much or wind up costing you a lot of money. It is possible to find good coverage for affordable rates, but it takes considerable research and understanding of what such policies entail.  

Types of Vehicle Insurance Coverage

Before you begin shopping for cheap vehicle insurance, you must understand what vehicle insurance will cover. Different policies offer different types of coverage. The cheaper the coverage, the less likely it is to have all the below-listed benefits in one policy. The precise terms and conditions differ between policies, but the general parameters remain the same.

  • Liability Coverage – Covers the costs of damage that you caused to other drivers and their vehicles during an accident. It covers everything from medical treatments to vehicle repair.
  • Medical Payments Coverage – Covers the medical costs related to treating injuries that you or your passengers suffered during an accident. It applies regardless of who caused the accident.
  • Uninsured/Underinsured Motorist Coverage – Covers any expenses that were results of an accident caused by a driver who either doesn’t have insurance or doesn’t have enough liability coverage to pay for all of your accident-related expenses.
  • Collision Coverage – Covers the costs of repairing the vehicle that was damaged in a collision.
  • Comprehensive Coverage – Covers the costs of repairing damages that resulted from anything other than a collision. It usually winds up covering the costs incurred due to weather damage, vandalism or hitting a passive object such as a tree.
  • Personal Injury Protection – Covers accident-related expenses that don’t fall under other types of coverage.  It can cover long-term medical care, income you may have lost because your vehicle is out of commission and childcare expenses. This coverage is limited to certain states.

Narrowing Down Your Options

The best way to find cheap vehicle insurance is to compare as many policies as possible. This is best done through the Internet, where you can look up the rates in seconds and compare them. In fact, there are several websites that specialize in comparing insurance rates. You may also want to browse online forums that deal with vehicle insurance. Repair shop managers are another good source of advice.

Scams to Watch Out For

Over the course of your search, you will find many vehicle insurance providers that offer cheap rates. Unfortunately, many of them will be insurance scams – as the saying goes, if something is too good to be true, it probably is. Some of the more popular scams are listed below.

  • Low Balling – In this scam, the insurance company offers you a cheap rate, only to inform you a month after you sign up that the low rate was due to a “company rate error” and the actual rates are much higher.
  • Invalid Insurance – In this scam, a company sells you what it claims is a cheap insurance policy, but when you have to use it, you discover that the policy is invalid. In some cases, you may also discover that the company vanished off the face of the earth. The purpose of this scam is to get you to pay money before they have to pay anything in return.
  • Referral Fee Scam  – A person claiming to be an insurance agent offers to get you a cheap insurance – for a fee. He or she then falsifies your personal information to get you lower rates than what you would otherwise get. When you have to use your policy, the company realizes that the information they got doesn’t match the reality and the insurance is declared invalid, leaving you with the full bill.

You can avoid those scams by asking an insurance provider for their license. You can also look up their record at Better Business Bureau and at your state’s Attorney General’s office. Keep in mind that the real insurance agents don’t ask for fees, nor should they offer to fill out your forms for you. If any terms of the contract look vague to you, ask the insurance provider to explain it in plain English.
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