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What Insurance Companies don't want you to know

Source: Yahoo News

We all need car insurance, the law requires that you have car insurance before you can drive on our highways. What the law doesn't require, is that you have more insurance than you need. How much Insurance that you purchase is open to interpretation. Let's cover some of the variables involved in keeping your car properly insured. Here are four things that the insurance company doesn't want you to know.

1. Car insurance companies know that people usually don't keep up with the present values of their automobiles. Do you know how much your car is worth today? It doesn't matter what you think it's worth, the insurance company goes by the Book Value. You should know what your car is worth in today's market. There are guides like Kelly's and Edmond's that give accurate appraisals of what your car would fetch. Auto prices are also different in various regions of the country. You can find what your car is worth on the Internet. Just type in used car prices on your favorite search engine. Another thing that you should know is that there are usually three categories of prices in these guides. Insurance companies usually payoff for the lowest two categories. There is no such thing as excellent condition to the insurance company.

2. One thing the insurance company has that you don't, is statistical data. Basically, insurance companies are betting against you. You are betting that you will have an accident. The car insurance company is betting that you won't have a claim. Their statistical data is usually in their favor. Think back about your past driving history. If you're an average driver, you don't have many accidents. If you do have accidents, your insurance company usually drops you. Total up how much you have spent on car insurance over the years and it may make you cry.