Kimiko Kidd
No Comments

Hidden Costs of Buying Discount Car Insurance

Decrease Font Size Increase Font Size Text Size Print This Page
auto insurance policy car insurance

Every state legally requires drivers to have auto insurance, so it’s an unavoidable expense that comes along with car ownership. Naturally, you don’t want to spend any more on insurance than you have to. But are there drawbacks that come with opting for the cheapest discount car insurance? Here’s a look at some common cons to consider.

Enjoy Peace of Mind on the Road: Learn about OnStar services

Not enough coverage

Make sure you know how much liability coverage you’re buying. According to Insurance News Net, experts suggest having at least $500,000 worth of liability coverage. But to really protect yourself, you should carry a policy of at least $2 million. How much does your average minimal-coverage discount insurance cover? Typically, between $10,000 to  $30,000 worth of liability. So if you’re in anything more serious than a minor fender bender, you could find yourself on the hook for quite a lot of money.

Dodgy customer service

Research your potential insurer before you make the switch. While the promise of low payments may be tempting, check out some reviews. You don’t want to get stuck with a discount car insurance provider that’s notorious for ignoring customer inquiries, dragging its feet with claims, or refusing to pay out. Even some reputable insurers de-prioritize customers with discount policies, so make sure to do your homework in whichever insurance provider you choose.

High deductibles

When it comes to low rates, there’s usually a catch — like a high deductible. So when it’s time to make a claim, you’ll be stuck footing most of the bill before your insurance kicks in to cover the rest.

Understand what your insurance covers

It may seem like you can get a sweet deal by purchasing liability-only insurance. It’s enough to keep you on the road legally, but it could leave you in quite a jam. Your liability insurance’s job is to cover the repair and medical expenses you’ve incurred on your fellow road users. So when it comes to helping you pay for repairs, you’re out of luck if you’ve only purchased liability insurance. Collision coverage is what you’ll need to get your vehicle back on the road. And if your vehicle suffers damage from the weather, you won’t be seeing a dime unless you have comprehensive coverage. On top of that, liability coverage won’t help you out with any medical bills — that’s what you’ll need medical payment coverage for.

Need Some Help After a Fender Bender? Get your car looking good as new with the help of a GM-Certified body shop

On a budget? Check out these tips for saving money on your car insurance.