Auto Accidents: Top 9 Mistakes When Buying Your Auto Insurance MISTAKE NINE: Blindly Renewing Your Policy

Face it. Most people are lazy.  When it comes time to renew our auto insurance, most of us simply buy the same coverage we had last year.

That’s a mistake.

Situations change, and you need to take that into account when renewing your insurance each year.  Your finances may be in a little better shape so you need more protection.  Your car may be older so it may need less coverage.  You may have a new driver in the family.

Your circumstances are always changing, and many of those changes affect the type of coverage and the amount of coverage that you need.  Don’t just take the easy way out.  Spend a few minutes looking at your circumstances and needs and make an informed choice.

Auto Accidents: Top 9 Mistakes When Buying Your Auto Insurance MISTAKE EIGHT: Thinking That You Are “Fully Covered”

I often ask clients who have been victims of car wrecks what type of coverage they have.  Most respond that they are “fully covered.”

What does that mean?  Too often, people who tell me that they are “fully covered” aren’t fully covered.  They usually only have the minimum liability limits required by law.  But they think they’re “fully covered” because some agent told them that without explaining to them what it really means.

As I’ve mentioned earlier, when buying liability insurance to protect yourself from a claim made against you when you cause a wreck, you need to make sure you have adequate liability insurance.  For most people, that means more than the $30,000.00 required by law.

Additionally, you need to buy personal injury protection and uninsured/underinsured motorist coverage to make sure that you’re protected when you or your family is injured in a wreck caused by someone else.

In my mind, you’re not “fully covered” until you have these types of insurance in sufficient amounts to cover a likely claim size given your circumstances.

Don’t just let the agent tell you you’re “fully covered.”  Make the agent explain what the mean and how you’re being protected.

Auto Accidents: Top 9 Mistakes When Buying Your Auto Insurance MISTAKE SEVEN: Lying To Your Insurance Company

When you fill out your insurance application, you’re asked to provide a lot of information to your company.  You may be asked about your driving history, how many miles you drive per month or year, your home address, where you park your car overnight, and more.  Studies show that a significant number of people provide wrong information on their applications, usually in an effort to try and save a little money.

But these “mistakes” can often come back and bite those not being truthful.  These mistakes could lead to insurers partially or completely invalidating the policy or completely cancel the policy, making it much more difficult and expensive to obtain insurance in the future.

The better plan is to be truthful on the application.  In this case, honesty is the best policy.

Auto Accidents: Top 9 Mistakes When Buying Your Auto Insurance MISTAKE SIX: Not Looking For Discounts

If you’ve read the other mistakes, you know I think people spend too much time looking at price when deciding what insurance to buy.  But I don’t think people spend enough time looking for discounts.

Once you have narrowed your search of insurers down to two or three respectable companies, do your homework to consider what discounts the companies offer.  Most companies offer discounts for consolidating homeowners and auto insurance, but the discounts go far beyond that.  Insurers may offer discounts for things like:

  •     your car has daytime lights;
  •     you’ve completed driver’s ed;
  •     your driving age kids have good grades;
  •     your kids are away for school; and
  •     you or someone on your policy is deployed.

Make sure you ask your agent about potential discounts.  You can also check the Texas Department of Insurance website, which lists discounts for many auto insurers.

Auto Accidents: Top 9 Mistakes When Buying Your Auto Insurance MISTAKE FIVE: Picking The Wrong Insurance Company

If you pick the wrong insurance company, you increase the likelihood that you’ll end up fighting them if you ever need to make a claim.  Similarly, if you cause an accident and hurt someone, having the wrong insurance company could increase the likelihood that you end up being sued.

Too many people end up with these problems because they didn’t do their homework up front.  There are a number of things you can do to help you avoid these mistakes.

1.  Check out the Texas Department of Insurance website (www.tdi.texas.gov). The website contains reports showing the number of verified complaints and the number of policies written by each insurance company.

2.  Talk to friends who have had problems with insurance companies.  Most people haven’t made claims on their policies.  When talking around, you want to make sure and talk to friends who have actually been involved in claims — both those who have made claims against insurance companies and those who have been on the receiving end of claims.  Ask about their experiences, the types of trouble they might have had, the length of time before the issue was resolved, and whether they would buy that insurance company.

3.  Use the internet.  Internet research is your friend when investigating insurance companies.

Perlmutter & Schuelke, PLLC maintains offices in Austin, Texas. However, our attorneys and lawyers represent clients throughout the state of Texas, including Dallas, Houston, San Antonio, Forth Worth, El Paso, New Braunfels, San Marcos, Kyle, Buda, Round Rock, Georgetown, Lockhart, Bastrop, Elgin, Manor, Brenham, Cedar Park, Burnet, Marble Falls, Temple and Killeen. By Brooks Schuelke


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