Does Your Insurance Reflect Your Lifestyle?

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Understand your insurance options so you can be as choosy about them as you are about your wheels.

For most of us, choosing the right car means tons of research, multiple test-drives and plenty of shopping around. You may think that all of your decision-making is done once you’ve got the keys in your hand, but you’ve still got another big decision to make: buying the right type of auto insurance.

Many people take the easy—and cheap—way out by choosing the lowest price available. However, that decision could end up costing more than you expected in the long run. To protect yourself (and your car), make sure that you get insurance coverage that matches who you are and how you drive.  

How sweet is your ride?

If you’ve inherited your parents’ beat-up minivan, quality insurance may not be your top priority, but it’s still important to protect yourself with liability insurance in the event that you accidentally hit something—or someone.

If you’re protective of your new car and want to keep it pristine, you may want to spring for comprehensive insurance. As its name suggests, a comprehensive policy basically covers all losses that aren’t covered under collision coverage, even the unexpected, like vandalism or weather events. That could really come in handy if you live in the city and park on the street.

Do you have assets?

Even a minor car accident can turn into a major hassle. Throw in serious car damage or a physical injury and that hassle can become a financial nightmare. Depending on circumstances and the laws in your state, you could be personally responsible for repair and medical costs. Those bills and car repairs can end up costing well above your state’s minimum liability amount. And if you don’t have that kind of cash, other assets like your house or your savings could be at risk in a lawsuit.

While your state will set the minimum liability coverage you’re required to purchase, sometimes that coverage may not be enough. It’s often worth paying the extra premium to ensure that you’re covered in all situations. If you’re not sure how much to get, find an insurance agent to help you figure out the best balance between cost and coverage. They may also suggest umbrella coverage, which helps protect your assets in the event of a lawsuit.

Usage-based insurance (Telematics)

Recently, some insurers have offered discounted insurance policies for drivers who enroll in telematics programs that track driving behavior and use that information to help promote a greater awareness of safe driving practices. This information also helps your insurance company make additional adjustments to your premiums based on how much and how safely you drive. While this may not be the best idea if you view stop signs as optional, it could save you some money if you’re a particularly careful driver. Or maybe the promise of a lower rate could be the motivation you need to overhaul your driving habits and become more cautious on the road.

Rideshare insurance

If your car is also part of your side gig, rideshare insurance can be a lifesaver. Many drivers who sign on with companies like Uber or Lyft assume that those companies have insurance to cover them. But in most cases, the company’s full coverage only kicks in once you’re headed to pick up passengers or have a passenger in the car.

If you’re just logged into the app, waiting for a ride request, you may feel like you’re on the job. But if anything happens, the rideshare company’s insurance may not cover it. If you start driving for a rideshare program, it’s best practice to notify your insurance company immediately. Your insurance agent can inform you of your options and help you understand the overall impact to your premiums. Rideshare insurance is competitively priced, and it’ll keep you covered if you get into an accident while you’re on the job.

Little extras that can save a big headache

If you don’t want the extra anxiety and hassle that pops up when unexpected issues arise, look into additional small benefits you can add to your insurance. A little extra preparation could save frustration (and money) down the line.

For example, you might consider:

  • Roadside assistance. If you break down, you won’t have the extra hassle of having to locate—and pay for—a towing company to get you to a garage.
  • Rental car reimbursement. If your car is in the shop, your insurer will pay for a rental. If being without wheels is not an option, this option can save frustration and expense.
  • Full glass coverage: Minimum policies usually don’t cover chips or cracks. With full glass coverage, you get your windshield repaired or replaced without opening your wallet.  
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