Items You Should Know About Your Auto Insurance

In an effort to better educate consumers about their auto insurance coverage, the Perimeter Group has put together a list of items everyone should know with regard to auto insurance here in Arizona. By knowing this information you should be able to avoid some of the pitfalls a lot of people have with their auto insurance, especially when you need to make a claim or shop for a better rate.

  • You will pay dearly for being under-insured

    Purchasing state minimum coverage could result in financial ruin if you are involved in an at-fault accident. Your wages could be garnished, become a party of a major lawsuit and lose the ability to obtain credit for future major purchases. The cost to raise limits is relatively small in comparison.

  • Excellent Credit Means Better Premiums

    Most Insurance carriers give significant premium discounts for clients who have excellent credit and apply surcharges to those not having good credit. If you have good credit, get quotes from those carriers who give the best discounts and if you have bad credit make sure you receive quotes from those carriers that do not penalize as much for having a low credit score.

  • The Car Model you drive affects your premium

    Before you purchase your next car call your agent to find out what it would cost to insure it. Besides the age of the vehicle, the accident history of the vehicle as well as the cost of the replacement parts have a major influence on the cost of insurance.

  • Paying your insurance premium in full or via Electronic Funds Transfer saves you money

    Many carriers now provide an excellent discount to clients who choose to pay their premium in full or automatically from a checking account or credit card. In addition, some give an additional discount for increasing the term of their policy from six months to a year.

  • Stolen or damaged personal item are NOT covered by most auto insurance policies

    Items not considered part of the vehicle are not covered unless added through an endorsement. However, you can receive coverage through your homeowner’s policy.

  • Bad Drivers will pay a lot more

    Expect to pay 25 – 40% more in increased premium for an at-fault accident. Likewise, minor and major moving violations will add more premium on top of any accident. Carriers include these events from 3 to 5 years in rating potential clients.

  • You will pay for loaning your car to a friend or non-household member

    If a person who you loaned your car to gets into an accident that is deemed to be at fault, you will need to file a claim with your insurance company and pay any deductible. Insurance follows the car first then the driver. While the accident is not your fault you will still lose your claim free discount for future premiums for at least three years.

  • The value of your “totaled” car might surprise you

    Insurance companies do not use the Kelly Blue Book to determine value at the time of an accident. They have their own software programs to determine a car’s value that takes into account mileage and pre-existing condition. If you have a loan or lease GET gap insurance to cover the difference of what you owe versus what you will get from the insurance company based on depreciation. Keep good maintenance records and let the insurance company know of recent part repairs and tire replacement.

  • Check into “diminished” value claim compensation

    If you in an accident where the other driver is at fault ask to receive “diminished” value compensation that takes into account what your vehicle’s resale value will be versus what it would have been without being involved in an accident. Some carriers will provide some will resist.

  • After Market Items need to be Endorsed on policy

    If you upgrade wheel rims, suspensions or body paint as well as add electronic equipment that is not part of an auto manufacturer package or AFTER you purchase your vehicle from the dealer you need to inform your agent to add these additional items to have coverage.

  • Ask about Sales Tax Compensation in Your Claim

    In Arizona, insurers are required to pay the sales tax you paid on your vehicle. Make sure you ask if it is included in your claim compensation.

  • Remember to add licensed teenage drivers to your policy

    You are not required to add a teenage driver until they obtain their license. However, it should be done immediately after they get licensed. If an accident occurs and they are not listed on the policy, it could cause major problems such as back premiums, lack of coverage and loss of preferred status.

  • You MUST officially cancel your policy in writing when switching policies

    If you don’t provide a written cancellation and ignore bills from the previous carrier it could impact your credit score and ability to get credit.

  • Your car repairs do not necessarily include OEM parts

    Most carriers only use OEM (Original Equipment Manufacturer) parts to repair a vehicle for the first two years of a car’s life. If this is important to you ask your agent to include this coverage in your policy. It does come at an additional cost with most carriers. However, non-OEM parts used in a vehicle’s repair are warrantied for the as long as you own your vehicle.

  • Stay “involved” in your repair process

    Get timing commitments upfront from the repair facility. If the repair takes longer than promised get an extension on “rental car reimbursement”. You have more leverage if you use a repair facility “recommended” by the carrier. If you use another facility get commitment on price, timing and warranty in writing.

  • Take pictures of the accident scene with your cellphone camera

    If you are involved in an accident take pictures of all the vehicles involved. Make sure the picture includes the license plate number and driver if possible. Try and obtain the insurance information from the driver or police officer. As a back-up keep a disposable camera in the glove box.

  • Use you Cellphone as “Proof of Insurance”

    Arizona law now allows you to use your cellphone to show proof of auto insurance. Every time you receive new auto id cards from your carrier take a snap shot to keep on your cellphone. When ask for proof of insurance from an officer just show then the picture of your current auto id card

Hopefully, this knowledge will assist you in obtaining the coverage you need along with getting fairly compensated for an auto claim.

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