Avoid These Common 5 Mistakes When Buying Vehicle Insurance

Hastily buyingVehicle Insurance can be as risky as buying a car without research. You could end up paying too much for features you don't need or get a car that doesn't deliver on performance. Switching to better Car Insurance is easier than swapping a newly purchased car. At Dialdirect, we like our customers to make informed choices. This guide highlights mistakes you can avoid when buying Vehicle Insurance.

Why the Right Vehicle Insurance is essential

Vehicle Insurance is meant to protect you financially if your vehicle is stolen ordamaged, whether in an accident or through another incident. Without the right insurance coverage, you could suffer significant financial loss and stress. Vehicle Insurance can cover repair costs to varying degrees, depending on the cause of the damage. If yourvehicle is written off following an accident1, or stolen, the insurance payout could help you buy a replacement. And at the very least, if you've caused an accident, your Vehicle Insurance could cover repair costs to a third party's vehicle or property.

What is covered depends on your Vehicle Insurance type and your insurer's inclusions. There are three types of Car Insurance available:

1.       Comprehensive Insurance: This provides the most extensive coverage, including damage to your vehicle, third-party damage, theft, and fire. It’s ideal for anyone wanting maximum protection.

2.Third-party Fire and Theft Insurance: Covers third-party damages caused by you, as well as damage to your vehicle from fire or theft. It’s a middle-ground option, offering more protection than Third-Party Only without the higher cost of Comprehensive Insurance.

3.Third-party Only Insurance: Covers damages you cause to other people’s property or vehicles but does not cover any damage to your vehicle. It’s an affordable option for those with a limited budget.

Choosing the right type of insurance and coverage amount can be challenging. You don't want to end up paying for coverage you don't need, but you also need to avoid being underinsured. So, let's first look at what mistakes you should avoid making.

5 common mistakes to avoid when choosing Vehicle Insurance

There are times when learning from your mistakes can be a valuable lesson. Signing up for Car Insurance is not one of those times. Instead, being aware of other people's mistakes when buying car insurance can help you make the right choice. This ensures you end up with the coverage you need.

1. Ignoring a wide range of insurance options

Don't join the countless number of people who failed to explore the full spectrum of insurance products available to them. Car Insurance companies offer different plans with varying benefits and coverage levels. One insurer's top plan could offer extra benefits as standard, while other insurers may charge extra for the same perks. By not comparing these options, you may miss out on better coverage or more competitive premiums.

2. Settling for minimum coverage

Choosing cheap Car Insurancemight seem like a cost-saving measure, but it leaves you vulnerable. Cheap Car Insurance typically does not protect against many common risks, potentially leading to significant out-of-pocket expenses. This doesn't mean it should never be considered, especially with low-value older vehicles. 

3. Missing out on available discounts

Insurance providers sometimes offer lower premiums for safe driving, bundling multiple policies, or for infrequent driving. Many policyholders overlook these opportunities, resulting in higher premium costs. Taking advantage of these discounted premiums can make a significant difference in your insurance expenses.

4. Not disclosing all vehicle users

It's vital that you disclose all potential drivers of your vehicle to your insurer. If you don't, you risk having claims denied if an undisclosed driver is involved in an accident. This oversight can lead to significant financial and legal complications.

5. Skimming over the policy details

Insurance policies are often dense and filled with technical language, but failing to read them thoroughly can lead to misunderstandings about your coverage. Not knowing the specifics of what is and isn’t covered can result in unpleasant surprises when you need to make a claim.

Tips to help you get the best Car Insurance

Now that you know what mistakes to avoid, let's look at what you should do to ensure you have the right coverage at the right price.

• Thoroughly compare policy quotes: Don’t settle for the first quote you receive. Comparing multiple quotes from different providers allows you to see the range of options available and ensures you get the best deal. Take the time to review what each policy covers and at what cost.

• Carefully assess your coverage needs: Evaluate your specific needs to determine the right level of coverage. Consider factors such as your driving habits, the value of your car, and your budget. Adequate coverage means you’re protected against potential risks without paying for unnecessary extras.

• Ask about discounts: While many insurers offer various discounts that can significantly reduce your premium, what is available isn't always clear. Ask about lower premiums for attending an advanced driving course and having multiple policies with the same insurer. Don't forget to ask about no-claim bonuses.

• Provide accurate information: Ensure that all information about your vehicle and its drivers is accurate and up to date. This includes disclosing new potential drivers, any modifications to the vehicle, and changes to where you park at night. Accurate information helps avoid coverage issues and ensures your policy is valid.

• Read the policy details carefully: Take the time to thoroughly read and understand your insurance policy. Know exactly what is covered, what exclusions apply, and what your responsibilities are. This helps avoid surprises and ensures you’re fully aware of your coverage.

• Regularly review and update your policy: Your insurance needs may change over time, so it’s important to review your policy regularly. Update your coverage as needed to reflect changes in your vehicle usage, the addition of new drivers, or other relevant factors. This ensures your policy remains effective and relevant.

Get a Dialdirect Car Insurance quote

Ready to find the perfect Vehicle Insurance for your needs without making a single mistake? Fill out all the relevant details online and get a Car Insurance quote from Dialdirect in minutes.

Dialdirect is a licensed non-life insurer and financial services provider. Terms and Conditions online.

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Sources:

[1] News24:  https://www.news24.com/life/motoring/news/guides_and_lists/what-to-do-when-your-car-is-written-off-after-a-crash-20200212-2