How to choose a car insurance coverage policy

A man in front of a computer screen displaying the words "Car Insurance," and several graphs and graphics

Choosing a new car is fun. Choosing a new insurance plan for your car is not. People fantasize about whipping down an open road, sun gleaming off the pristine exterior of the hood, while their favourite song dims the purr of the engine to a quiet undertone. No one fantasizes about blowing a tire, running into a telephone pole and saving money with that sweet new coverage they bought. But dull as it may be, taking time to choose insurance coverage is important. Not just in the sense that you choose a plan (which you legally need), but rather the right plan.

But what is the right plan? Should you go low premium and high deductible, or is the opposite better? Should you add a secondary driver or does that seem like a waste? Is it worth going with the company that provides you with home insurance, or is there a lower rate out there?

The answer is, of course, that there is no single policy that is objectively superior to all others. It really comes down to your personal situation. That’s why it is important to consider your needs and your means when selecting the coverage plan for your vehicle.

Consider your needs

The main reason there is no single plan that is optimal for everyone is that everyone has different requirements. Someone who uses their vehicle to commute an hour each way to work five times a week will obviously require different coverage than someone who leaves their vehicle in the driveway while they work to fix it up. These scenarios are extremes, but there is a lot of discrepancy in the middle that dictates the level of coverage needed.

The same is true for secondary drivers. If you have someone that will regularly use the vehicle, who is not already covered, adding them to the policy makes sense. If this situation doesn’t apply, there is no need for this extended coverage.

The kind of vehicle you have will also determine the coverage type that is most suitable to your needs. It is generally advisable to pay higher premiums on a new car than on a decades old junker that is falling apart at the seams. Because whereas you will certainly pay a few hundred bucks to salvage a car you purchased six months ago, a high deductible is fine for a car for which any significant damage would cost more than the car is worth.

Consider your means

If money is no object you might as well get whatever insurance coverage you want. But, if money matters, then you probably won’t just pick the most ironclad policy you can find. For most people, it’s about finding a balance between what they want and what they can afford. In this sense, insurance is very much like any other purchase we make.

To widdle down to the ideal level of coverage, balance your needs against your wants. Address the former and see what that costs you. Then add the wants. This way you will get the coverage you need before sizing up elements that might be helpful, but are not strictly necessities.

Once you sort out the coverage you require, it’s time to find out which provider offers you what you need at the best rate.

Shop around

You can call a bunch of providers to get quotes. You can visit their websites and see what they have on offer. Or, you can just compare with us.

Yes, we may be a little bias, but you can get three quotes in less than three minutes with Insurance Hunter. Visit our auto insurance page, provide some basic information and get quotes from multiple sources that offer what you’re looking for. The advice is bias, sure, but also helpful.

You can also negotiate. Just as when buying a vehicle, you don't have to pay the sticker price. Sometimes discounts can be found if you know where to look.

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