Steps to take before signing in a car insurance policy
A car insurance policy is a contract between you as the policy holder and your car insurance company as the provider of insurance. In reality, it is not enough just to acknowledge that your car insurance policy fulfills the coverage requirements of your state.
You should also know precisely what your car insurance policy covers and does not cover. Check it carefully before singing in a car insurance policy to prevent you from finding out after involving in an accident that you are not currently covered while you thought you were.
Parts Of An Auto Insurance Contract
The majority of auto insurance policies have 4 fundamental parts:
- Declarations pages
Also known as Dec page, this part is like your own personal profile. It has your coverage limits as well as deductibles, the length of your policy, and personal information like your name, your address, the names of other motorists in your household, the models, makes and vehicle identification numbers of vehicles on the policy, and the policy number.
- Insuring Agreement
The insuring agreement or the coverage parts will describe your current insurance plan. It will list your deductible as well as coverage limits for every type of coverage that you are buying.
These are particularly people, events, damages, and property that your current insurance policy does not cover.
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This part will list down the responsibilities of your car insurance company as well as you, including the payment of premiums, the process to file a claim, and the procedure to resolve disputes.
This part might be the “fine print”, yet it is equally crucial. It will define the terms used in the policies and specifically describes your own rights.
Do Your Due Diligence
The car insurance contract is actually binding. You will be obligated to apply and follow its terms after signing in it, so it is very important to take time to do your due diligence.
- You should read all parts of the contract to understand how much you have to pay, how much you will be covered for, and what is as well as is not covered.
- You should avoid skimming. You will want to know what will be covered if there is an accident happening.
- You should ask questions once you are not sure about anything mentioned in the contract. Don’t worry; your car insurance agent will be there to response all your questions.
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Tips On Signing A Car Insurance Contract
It is worth taking time to review your insurance policy so you will not sign anything that you do not feel comfortable with. Initially, research your auto insurance provider, particularly if it is just a small company that you feel unfamiliar with.
- Check the insurance department website of your state by making use of a computer or a phone.
- Check with the car dealerships and auto body repair shops. They will offer you first-hand recommendations.
- Check the financial strength rating of the company you choose.
- Check how the provider rates on prestigious sources. The high ratings of satisfaction among customers will put your own mind at ease.
Now, it is time to learn the tips on signing a car insurance contract.
- Avoid signing any contract with blanks or an empty space. Have the insurance provider draw a specific line through the blank or space if no extra information is added or required.
- Avoid signing if the contract denies you the proper right to sue that insurance provider. Otherwise, you may lose your right to take the company to court when you have a disagreement over the coverage. If there is not something like this option, then the car insurance company might be more apt to make use of you, playing the hardball with your claims.
- Think carefully and again about signing if the insurance policy contract that states, “Aftermarket parts might be used for any necessary car repairs.” It is because if your car is new, then you do not want it being fixed with the “aftermarket parts.”
- Warrant that you do not buy unnecessary coverage. For example, your vehicle is $1,500 value; it may be not worth it to purchase collision coverage worth $3,000.
- Make sure that the coverage your have selected are clearly listed. For example, if you have chosen for rental car reimbursement in the event of the car accident, then you should make sure that you can see this listed on your contract.
- Check the car information, deductibles as well as coverage limits.