If you are shopping for your first car, you will also be in need of car insurance. The type of coverage available is wide-ranging and the cost is too. However, there are a few important things about auto insurance that you should know before you purchase your first policy. The following are among the most important.
The price of insurance relates directly to the car
You are likely aware that certain cars cost more to insure than others, but most people shopping for a car do not go to the trouble of getting quotes for insurance. But you need to know the cost of ownership, and one of the biggest factors in making this calculation is the insurance cost. Not only is there a difference between new and used cars and high-cost and low-cost cars, but some cars are more popular than others for stealing. You need to be aware of this before you purchase a car. Do not make assumptions about insurance premiums.
You may be required to have full coverage
Unless you are planning on paying cash for your car, any lender will require you to have full coverage. One of the reasons for a down payment is that the lender can recoup most or all of their money for the loan you defaulted on. However, they must protect this collateral in the case of an accident that was your fault or if the car is damaged by weather, vandalism, or theft. This is true whether you buy a new car or a used car. You need to decide ahead of time if financing a car will be worth the extra insurance.
You may want more than the mandated coverage
Every state has laws regarding a minimum amount of car insurance. This amount will be for liability and property damage, and it is for the purpose of protecting other people and their property when the accident is your fault. The optional part of a typical full coverage policy is called comprehensive and collision. Collision will cover damage to your car when the accident is your fault. You may not want this coverage because your car is an old model. But you need to take a long look at comprehensive. Included in this coverage is theft, and even an older car can be stolen just for parts. Comprehensive may not add a lot to your premiums, but it can be worth the protection.
Buying your first car can be an exciting process, but you need to devote some of your time and energy to insurance premiums. If you have fallen in love with a particular vehicle, it may be too late to change your mind once you discover the cost of insurance. Get insurance quotes as you shop for your car, and you will buy a car that fits your budget.