After buying a new vehicle, there’s always a recurring dilemma that’s hard to ignore: how much auto insurance coverage should you get. On one hand, being prepared for the worst, that is, taking the most comprehensive auto insurance is smart – but costly. On the other hand, getting an insufficient coverage, and paying lower amounts of premium, may cause us to later pay dearly (literally speaking).

 
If you are like me, many times you pick the easy road, and just take the default option, or the most popular one. But that is not the right way.

 
The right way to determine the amount of auto insurance coverage

First, you must remember that the amount of car insurance, quite obviously, should be customized to the requirements of you and your family.

 
Second, you want to avoid paying too much every month, and yet you need to be prepared for the most likely – statistically speaking – scenarios. The trick is in striking a balance between choosing the most important aspects in the insurance and paying a reasonable amount.

 
Third, you must keep in mind that auto insurance rates are also affected by various factors out of your control such as gender, credit rating and age. The location of your residence also plays a major role for two reasons, both because are some neighbourhoods are more dangerous than others (again, statistically speaking), and the second reason, is because auto insurance criteria in every state are governed by a different set of standards and rules.

 
A good starting point would be to start with the minimum coverage you need to buy in your particular step, and the range of protection offered by this coverage. Once you do this, you need to find out other options and how much they would could.

 
For example, if you do live in a bad neighbourhood, it might not be a bad idea to go with a comprehensive coverage plan, which covers your primary vehicle and any other vehicle you own, and protects you against losses that may be incurred for many different reasons, including collisions – and also protects you if your car is damaged or stolen.

 
If you drive a lot, you should probably get collision coverage, which offers coverage for the damage caused to your vehicle in case of an accident – all the repair costs minus the deductibles are covered under this scheme. That being said, if your car is pretty old, then this scheme may not help you as the amount of coverage depends directly on the value of your car – in this case, you probably want to skip this type of insurance.

 
Additionally, if you drive a lot in the city, you may want to opt for medical coverage, which protects you against medical expenses for you or anyone hurt in case of an accident – you may even be covered (depending on the plan) if you, while being a pedestrian, are injured in an accident regardless of whose fault this is.

 
Uninsured motorist coverage is highly recommended as well, as it will protect you in case your vehicle is hit by an uninsured driver.

 
In conclusion, you need to weigh your personal circumstances and factor those in. Once you see things from this perspective, making the decisions of the amount of coverage – and options to choose from – should be much easier.

 
No matter how cheap our car insurance is, we always wish it could be even cheaper. At times it is easy to fall into a trap and think there is no way to get cheaper insurance. This article provides 10 such methods that can make your car insurance cheaper.

You can use this link to get a free insurance quote in seconds (this form only requires filling 2 pages of relevant details, and afterwards you will get a quote).

 
First, even though this may seem obvious, you should examine your existing policy and remove everything you don’t need. It’s possible when you got the initial insurance policy, you had a different perspective on things which has changed since.

 
Second, if you have children living far from home, there is no need to include them in the policy. This will already save you a bundle. Effectively, this is an extension of the first item, since when you originally created the policy, your children might have been living at home.

 
Third, if you have several vehicles, find out whether you can consolidate them with the same insurance provider: this is bound to get you a discount.

 
Fourth, find out whether there are any special discounts you are eligible to. i.e. non-smoker discounts, car/home policy discounts. Check out this special discount article.

 
Fifth, if your car is worth below a certain value (for example, when it is a very cheap car or it is very old) then it may be a good idea to drop the collision coverage. Over a long period of time, the amount you would pay your insurance provider for this may might go far beyond the worth of the car. Please keep in mind that this involves some risk (remember murphy’s laws): it is possible to get into an accident a day after removing this item from your policy.

 
Sixth, try to view your life from the perspective of an insurance provider. For example, if you recently changed your address, or you’re planning to relocate, your insurance premiums may be adjusted accordingly. This could be a result of moving to a new, riskier neighborhood (from the insurance company’s perspective). Having this perspective in mind may enable you to make calculated decisions that qualify you for lower premiums.

 
Seventh, this is pure common sense: be much more careful when you drive. Although this is bound to be good to your health, if you’re a reckless driver, your insurance rates are likely to become higher. Particularly in these rough economic times, this might be a good time to play it safe.

 
Eighth, consider increasing your deductible – which will decrease your premium. This can be viewed as having various ‘degrees of insurance’: at the most extreme version your deductible will be worth the value of the car and you’d pay no premium at all – effectively, you have no insurance. At the other extreme, your deductible would be minimal, but your coverage would be at its maximum

 
Ninth, when getting a new car, check with your insurance provider whether this has an effect on its premium. Certain car models, such as sports cars, may have increase the premium. The opposite is true as well: cars with smaller engines often have smaller premiums.

 
Tenth, and most important, , this cannot be emphasized enough: make sure you obtain quotes from several difference insurance providers. This can be done through this website (even this very page!), and is extremely simple to do. One of these policies is bound to be cheaper than the rest. It is important to make sure that these policies are generally equivalent (so there would not be any unpleasant surprises later on).

 
Finally (bonus tip): it might be worthwhile to investigate with the Better Business Bureau whether the insurance provider you’re considering pay their claims in time. Some are more problematic than others