Auto Insurance buying made easy

Source: John

Mistakes, we all make them, unfortunetly they can cost us some serious money.  When buying auto insurance, get smart first.  
Auto insurance isn't as confusing a subject as life insurance so buying a sensible policy doesn't need to be a reminder of the inevitable death we all face.  But that doesn't mean it's simple to negotiate. Having the wrong car insurance, or making the wrong claims, can put a serious ding in someone's financial health.

As with getting life insurance, some of the rules are straightforward: shop around to ensure a fair deal and review your policy annually to make sure that it still fits your life and financial condition. Here are a few other common mistakes policyholders should swerve away from:

1. Don't just assume the insurance salesman is your best friend.

The very best insurance policies for consumers aren't necessarily the ones that bring in the best numbers and bonuses for salespeople, says Andrew Tignanelli, president of Luthersville (Md.)-based money management outfit Financial Consulate. Remember that the next time you go shopping for car insurance. Often it's in the salesman's best interest to sell the "least amount of insurance that they can possibly justify." Smaller policies leave insurers less exposed to risk and proportionately tend to be more expensive. As a result, they're more likely to be profitable for the insurer. Because of this conflict of interest and other factors, Tignanelli says he finds that even wealthy clients are often underinsured.

Make sure you have "LIABILITY" coverage, which is usually mandatory in most states and covers the costs of another person's car damage and injury. "Comprehensive" will protect you if your car gets stolen, catches fire, or is damaged without coming into contact with another car. And "collision" covers damages if your car collides with another vehicle or object, no matter who's at fault.

2. DO NOT get a small deductible.

When purchasing car insurance, consumers frequently think of it as a way to protect themselves against every ding and scratch. That's a bad idea. "You should insure for what you cannot afford to lose," says financial planner Jeffrey Bogue of Bogue Asset Management. That means, don't have a miniscule deductible of $100 or even $250. "If you nickel-and-dime the insurance companies with these small claims, you may get socked with a premium hike or they may say 'we're not going to insure you,' " he says.
Think about these helpful tips when buying auto insurance and as always check out for FREE Auto insurance quotes that just take 7 minutes.