Buying car insurance for the first time? Here are 5 tips to help.
Congratulations on buying car insurance for the very first time! Okay, so maybe it doesn’t feel that exciting, but really, it’s kind of a big deal. Maybe it means you’ve bought your first car, or you’re finally moving off of mom and dad’s insurance policy and gaining more independence—either way, that’s some pretty awesome stuff right there.
But there is also the whole financial responsibility part of it, and figuring out what a fair price is and what coverages you should even get can be intimidating. That’s where we come in. We want to help you feel confident about your decisions when it comes to your first policy.
So, here are 5 tips for buying car insurance for the first time (and really … you’ve got this).
1. Know your state’s minimum car insurance requirements.
If you’re driving a car, then you’re legally required to have car insurance—specifically, liability coverage (this covers costs for other people and property if you cause an accident). So, that part’s easy.
In some states, liability is enough. In other states, you’re required to have additional coverages as well. For example, PIP (personal injury protection) is optional in some states, but it’s required in others. It just depends on where you live.
You can get a head start on conquering your car insurance by seeing which coverages are required in your state.
(The Root car insurance app actually makes sure you meet all your state’s minimum requirements when you purchase a policy. Hey, we like to make things easy.)
2. Learn about all the optional coverages available so you can make smart decisions.
Let’s talk about those optional coverages. Medical payments is an optional coverage that helps pay for your medical bills in an accident. It sure sounds important … but, do you need it? Maybe! This is why it’s important to do your research.
Here are some of the optional coverages you may come across for car insurance:
The more coverages you have on your policy, the more your policy will cost. It’s just a matter of weighing the risks—what you can afford to pay out of pocket for car insurance versus what you could afford to pay out of pocket for car damage or injuries without it.
Take collision. If you don’t have collision coverage and you run into someone, you’ll have to pay for the damages to your car out of pocket. If you paid for collision coverage, your insurance would help you with those costs.
(Also, keep in mind that you may be required to have additional coverage if you're financing or leasing your car. Just check with your lease or loan company.)
3. Your good driving habits can drive down your rate.
Here’s the quick and dirty on how traditional car insurance works. The traditional insurers base your rate on things like your demographics and driving record. They assume younger or less experienced drivers aren’t as good behind the wheel and charge them more as a result. (Yep, it’s pretty unfair.)
But, many folks who are buying car insurance for the first time are young adults and teens coming off of their parents’ coverage, or are just folks who haven’t driven all that much.That can lead to some really high rates.
Luckily, there are car insurers who actually consider how you drive to be a better indicator of whether you’re a risk on the road. For example, Root uses a person’s driving ability as the number one factor when determining a driver’s rate—more than their driving record or age.
That means if you’re buying car insurance for the first time, you could likely benefit from a company that cares more about how you drive behind the wheel than how many years you’ve been there.
4. Read reviews for each car insurance company you consider.
Choosing your car insurance company is an important decision, and one of the best ways to help you make this decision is to read a company’s reviews.
Want to know how a car insurance company treats its customers? If they offer fair rates, or if they make handling stressful things, like claims, convenient and simple? Sure, you can learn a lot from a car insurance company’s website, but if you want the real deal, see what their customers are saying about them. And don’t just look at the reviews a website posts about themselves (spoiler alert: they tend to stick to the really good reviews … but not always). Look for reviews on other sites like Google, or if the company has an app, check their reviews on Google Play and the App Store.
5. Understand what’s covered under your auto insurance policy.
Okay. So you’ve done all the research and have compared different car insurance companies. When it’s time to choose your policy, take the time to make sure you understand what’s covered and what’s not. You don’t want to wait until you need a coverage to realize you don’t have it.
If you have questions, reach out to the car insurance company and have a customer service rep walk you through the policy. Or, have a parent or friend who is wise in the ways of car insurance policies from years of experience take a look.
Then, once you feel good about the policy–—the price and what’s covered—it’s time to make it all official.
Okay, now breathe. Because really, when it all comes down to it, you can always change your car insurance coverage later. Realize you forgot to add a coverage? You can add it. Get married and want to add your spouse and their car? No problem. Decide you no longer need certain coverages and want to pay less? You get the idea.
What you choose for your first car insurance policy doesn’t have to be forever, so take the time to do your research and make the best choice for you now … and know you can always change it.
Ready to see if Root is the best option for your very first car insurance policy? Let’s do this! Just download the app and take the test drive.