Types of Car Insurance

Gap Insurance Refund

GAP Insurance Refund

GAP insurance, also known as Guaranteed Auto Protection, is an optional yet important addition to your car insurance coverage. GAP insurance helps drivers cover the difference between the amount they owe on an auto loan and their vehicle’s actual cash value (ACV) in the event of a total loss. Because new cars depreciate quickly early on, the amount owed to your lender often exceeds how much insurance companies will pay out for a totaled car. Instead, GAP coverage protects you from being personally liable and covers the total loss of the vehicle.

Furthermore, if a car is paid off in advance of the loan term, a driver is owed a GAP insurance refund. Because GAP insurance is often paid upfront at the dealership or with your lender, a GAP refund may be issued for any unearned portion of the coverage. However, if you pay your GAP coverage in monthly installments, you are not entitled to any refund.

Below, learn more about how a GAP insurance refund works. We’ll also teach you how to calculate your GAP refund or cancel your GAP insurance.

Gap Insurance Refund

How Does GAP Insurance Work?

The best and simplest way to explain exactly how GAP insurance works is to consider a hypothetical scenario. In it, you have just purchased a new car for $50,000, and you have been driving it for about six months.

Then, one day on your way home, you are involved in an accident, resulting in a significant amount of damage to your car. Later, your insurance company deems your car totaled, which means that even with repairs, the car is no longer safe to drive. At this point, once your insurance company determines that your car is a total loss, you know that the company will give you a check, allowing you to either pay off the value of your auto loan or buy a new car.

Unfortunately, many drivers are surprised when they see that check. Even though you paid $50,000 for your car, and even though it’s only a few months old and you still owe $48,000 on it, your insurance company only gives you $40,000 – which is the actual cash value of the car before it was wrecked. Unfortunately, this amount is not enough to repay the loan or buy the same car in the same model year.

Now, assume for a moment that you also purchased GAP insurance along with full coverage car insurance. After your accident, rather than writing you a check for only $40,000 (the depreciated value of your vehicle), you will get the full $48,000, or the amount you still owe. You will then take a portion of the payout and pay off your auto loan, but the rest should reimburse you for your down payment and car payments.

True to its name, this sort of auto insurance policy is designed to bridge the gap between your car’s depreciated value and the amount you still owe.

How Long Does It Take For GAP Insurance To Pay?

Depending on the circumstances around the total loss, it can take an insurance company up to 30 days to pay out on your GAP insurance coverage. During this time, you will want to regularly follow-up with your agent or representative to check on the process of your claim and provide all paperwork as quickly as possible. It is often best not to give the dealer, lender or your insurer any excuses to prolong payment of your claim.

GAP Insurance Refund After A Total Loss

If you are using your GAP insurance to pay off your lender because of a total loss accident, then you may be wondering if the rest of your GAP coverage premiums may be refundable. Unfortunately, policyholders are not due a GAP insurance refund after a total loss.

GAP Insurance Refund After Payoff

Most drivers don’t know about GAP refunds. You may be eligible for a GAP insurance refund if you pay off your car early. For example, GAP coverage at the dealer or with a lender is paid upfront and in advance. This protection covers you for the term of the loan, until it is paid off.

If a vehicle is financed for 60 months (5 years) but is paid off in 36 months (3 years), 24 months (2 years or 40%) worth of premiums are due back and must be refunded. Similarly, if a car owner sells or refinances the vehicle, a GAP insurance refund is warranted again.

While some lenders will automatically get a notification of your pay off, sale or refinancing and send you a check for the refund, others may not. It is your responsibility to follow up with the finance company to make sure you get your GAP refund.

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How To Cancel GAP Insurance

If you want to cancel your GAP insurance, remember that some dealerships or banks may require it for a certain amount of time as part of your loan’s terms. If you cancel it, your monthly payments may skyrocket, or the lender may consider your loan in default. Otherwise, to cancel your GAP insurance, simply call the company providing you with the insurance and request the cancellation.

Most companies will give you a full refund if you cancel within a certain period of time, which is usually between 30 and 90 days. If you cancel after this time has passed, you will instead be eligible only for a refund that has been prorated according to the length of time the policy has been in effect.

On the other hand, if you have completely and successfully paid for your auto loan in full, then you will no longer need GAP car insurance. To cancel it, gather the documents that provide proof your loan was paid off completely and then contact your GAP insurance company to request the cancellation.

How Long Does It Take To Get A GAP Insurance Refund?

Not all insurance providers will automatically send your refund, so you may have to ask them to send it to you. There’s usually a 30-day waiting period before the insurer will mail your check, so you can expect your refund to take about 4 to 6 weeks to arrive.

Who Should Consider GAP Insurance?

GAP Insurance

GAP insurance is ideal for anyone who owes more on his or her car loan than the vehicle is actually worth. Unless you put a large down payment on your car, you will likely be upside down on your loan the moment you leave the dealership. This is actually quite a common occurrence since automobiles tend to depreciate rather quickly once they leave the lot, even if they’re brand-new.

GAP coverage is designed to cover the difference between the depreciated value of your car and what you actually owe on that car. You might be surprised at the difference; sometimes, it can be several thousand dollars that you would otherwise have to pay out-of-pocket to your lender after a total loss.

How To Buy GAP Insurance

Depending on where you live, you can purchase GAP insurance for your new car in three different ways.

  • Bank or Lender – In order to mitigate risk and ensure that you do not default on your loan, some banks may charge you for GAP insurance and add the premium to the total value of your loan. Be aware that banks and finance companies often charge quite a bit more than the best auto insurance companies.
  • Dealership – If you financed your car directly through the dealership, there’s a good chance the dealer will also sell you GAP insurance, and they may even require it. Unfortunately, you will likely pay far more for the insurance than if you had purchased it on your own. Dealerships tend to have higher GAP insurance premiums than most carriers or even your bank.
  • Your Auto Insurance Company – The absolute best way to add GAP coverage to your existing auto insurance policy is through your current insurer. You’ll only pay about $5 more per month, on average, which is quite affordable, and your insurer will simply add the premium to your existing rate.

If you’re ever debating whether to buy GAP insurance through a dealer or insurance company, always choose to buy it through your own insurer. If the dealer requires you to purchase GAP coverage before leaving the dealership with your vehicle, then cancel the GAP insurance from the dealer after you have proof you’ve added it to your existing policy.

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Full Coverage vs. GAP Insurance

If you have traditional full coverage insurance, the check you receive covers your car’s depreciated value, which can be quite a bit lower than the initial purchase price since cars depreciate so very quickly. To put this into perspective, the value of most automobiles drops by 9% to 11% in the very first day after purchase. Unfortunately, without GAP insurance, you would be responsible for paying the difference between the value of your car and what you still owe on your loan.

On the other hand, if you opted to purchase GAP insurance (or if it was included in your insurance policy), you would receive a check for the amount of money you still owe your bank or lender. This is exactly what GAP policies were designed to do; they bridge the gap between your auto’s value and your loan’s value to reduce potential out of pocket costs.

Compare Car Insurance Quotes

If you’re looking to lower your car insurance rates or don’t think you are currently getting the cheapest premiums or best coverage from your current insurer, it may be time to compare quotes online. The best auto insurance companies are always competing for new business, and the only way to know if you are getting a good deal is to shop around.

Just enter your zip code to see other providers in your area and get a free, instant quote. Even if you don’t plan on changing carriers, sometimes having a competing quote from a rival company can encourage your existing provider to give you cheaper rates.

24 Hour Car Insurance

24 Hour Car Insurance

24 hour car insurance is a type of short term insurance coverage that typically lasts for only a single day. While the largest car insurance companies generally do not sell 24 hour coverage, in some instances, your existing policy may offer protection in the scenarios where 24-hr insurance may be needed. However, if you plan to get temporary insurance for one day, we still recommend you shop around for 24-hour auto insurance quotes to find cheap rates and good coverage.

Below, we’ll explain everything you need to know about 24 hour insurance, including the amount of coverage you can buy, the benefits of this type of policy, when you may need to get protection for a day, and who is eligible. Our goal is to help you find good coverage at the cheapest premiums with a reputable provider!

24 Hour Car Insurance

What Is 24 Hour Car Insurance?

Simply put, 24-hour car insurance is temporary, short-term coverage that provides you with certain levels of protection for one day, week, or month. It is typically far more affordable than your average 6 or 12 month auto insurance policy, but it supplies you with much the same coverage.

Though it is not a good idea to purchase this type of insurance for every situation, it can bridge gaps between coverage or help you stay insured during short-term changes in your driving habits.

For example, cheap one-day car insurance for new drivers may be the best way to cover yourself when buying a new car or finally getting licensed as an adult. Short term insurance will allow you the time to shop around and compare quotes, coverage, and companies before choosing a policy.

Amount of Coverage You Can Buy

Not all insurance carriers offer this sort of coverage, but providers who do sell it provide drivers with options for getting just the right amount of protection they want or need. Typically, 24-hour insurance companies allow you to purchase liability only or full coverage, which includes comprehensive and collision insurance.

The benefit of full coverage is that it pays for your own injuries and auto repairs, even in the event of an at-fault accident, and also covers damage from weather, theft, and vandalism. However, like traditional car insurance, short-term policy premiums will depend on your age, gender, driving history, the make and model of the car getting insured, the amount of coverage you buy, and other risk rating factors.

Benefits of Car Insurance For 24 Hours

Perhaps the biggest benefit associated with purchasing 24-hour car insurance is the fact that you can get covered immediately – as soon as you make your payment. This way, if you want to borrow, rent, or even buy a car but don’t currently have insurance coverage, you can drive home without breaking the law or risking a collision that would leave you financially responsible for damages and injuries.

It also helps that there are plenty of options for cheap 24 hour car insurance. While the cost of coverage is different by state, company and driver, rates can be as low as $10 per day. While a regular insurance policy is much cheaper in the long-term, this is a good price on temporary coverage for one day.

Why Would You Need 24 Hour Insurance?

You may choose to buy a 24-hour car insurance policy for several reasons. The most common include:

  • Buying A New Car – If you do not currently have auto insurance but you are buying a new car, 24-hour insurance can provide you with the coverage you need to drive your new vehicle off the lot safely and legally while you shop around for the best rates.
  • Renting A Car – If you plan to rent a car but your current insurance company and policy doesn’t cover rental cars, then you may need to buy temporary car insurance. Many rental companies will allow you to purchase this insurance directly through them at the time of your rental, but you may find that buying your own short-term policy comes with much lower rates. Not all auto rental companies allow this, so be sure that you check with them before buying a temporary policy.
  • Borrowing A Car – Most of the time, when you borrow someone else’s car, their auto insurance policy will cover you to drive it – even though your name is not on their policy – as long as you do not live in the same household. Many people who borrow cars still prefer to take out on day or weekly car insurance for extra peace of mind. What’s more, some insurance policies specifically exclude other drivers, and in this case, you would need to purchase one-day auto insurance to protect yourself and cover the car you are driving.

Who Can Get 24 Hour Auto Insurance?

Although most drivers can get temporary coverage without issues, 24-hour insurance is only available to drivers who are 21 years of age and older. In fact, there are many insurance companies who won’t even sell a 24-hour policy, or any type of short-term insurance, to drivers under the age of 25.

One reason is that, unlike other types of insurance, companies do not factor in your driving record when it comes to determining your premium. If you are a high-risk driver, you may not be eligible for short-term insurance at all. For this reason, it is critical that drivers always shop around to get the best and cheapest one-day car insurance coverage.

Compare Car Insurance Quotes

If you’re searching for 24-hour car insurance for new drivers to buy you some time before you get a traditional insurance policy with a provider, we can help! Just enter your zip code to compare insurance quotes from the top companies in your area. With instant online quotes, consumers can comparison shop to find the best coverage at the cheapest rates, resulting in huge savings!

DUI Car Insurance

DUI Car Insurance – Best Car Insurance After A DUI

Getting cheap DUI car insurance can be a pain. This is because insurance rates after a DUI or DWI always increase substantially and stay high for 3 years, making it difficult for drivers to find affordable coverage from good companies. Furthermore, if you’ve been charged with a DUI, there is also a good chance that state laws require you to carry special insurance and provide proof of this with an SR-22 or FR-44 form. But your life doesn’t have to come to a standstill with a DWI or DUI on record. Plenty of the best insurance companies cover DUI offenders, and while insurance may be 30% to 100% more than average, there are ways to lower rates.

Below, we’ll discuss everything you need to know about the different types of DUI auto insurance, how long a DUI will affect your insurance, how to shop around and find the best car insurance for a DUI, and the many ways you can save money on premiums. Ultimately, our goal is to help you get back on the road with the cheapest car insurance after a DUI.

DUI Car Insurance

How To Get Cheap DUI Car Insurance

After being charged with a DUI, it is common for your state to require you to carry specialized high-risk auto insurance coverage. If there’s one thing that can be said about DUI insurance, it’s that it is far more expensive than a typical policy.

Once you have a DUI on your record, insurance companies see you as a liability. In other words, insuring you comes at a significant risk, and the premium you were paying is likely to increase significantly. In some cases, your provider may even cancel coverage or drop you when it’s time to renew your policy.

You can obtain high-risk insurance through your current insurer if you choose, but you should be aware that even if your current company was previously giving you the best rate, that may no longer be the case. For this reason, if you are required to get insurance for a DUI, we recommend you check not only with your current provider, but also with numerous other companies.

You may find that another company offers a lower price for the same amount of coverage. Some carriers specialize in insuring high-risk drivers with bad records, while others increase their premiums until these risky drivers leave. Even if you have to switch companies, it is worth the savings to do so. Getting free quotes online from several insurance carriers is the best way to get cheap DUI car insurance.

Another important tip to remember when searching for the best car insurance after a DUI is to consider lowering your coverage limits. The amount of insurance you buy plays a big role in determining how much your insurance will cost, so many DUI drivers tend to get less coverage with higher deductibles to keep premiums low. Generally, getting cheap DUI car insurance in states like California, New York, and Florida means drivers must only buy enough liability coverage to meet state minimum requirements.

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How Much Does Insurance Go Up After A DUI?

If you’re wondering how much insurance rates increase after a DUI, here are a few examples of DUI rates. We compared pricing from the largest insurers – State Farm, GEICO, Allstate, Progressive, and Farmers – for a 30 year old male driver with full coverage on a 2014 sedan. As you can see, the cost of insurance with a DUI on your record is very expensive.

Nevertheless, it is important to note that, because premiums vary by company, driving history and location due to state laws and requirements, some drivers may experience a bigger effect on their insurance than others.

CompanyAvg. Monthly Base RateAnnual PremiumsAvg. Monthly DUI RateAnnual DUI PremiumsIncrease For DUI
State Farm$130$1,548$219$2,63270%
GEICO$190$2,268$361$4,33291%
Allstate$191$2,292$338$4,05777%
Progressive$160$1,932$288$3,45879%
Farmers$205$2,460$375$4,50283%

DUI Insurance Rates By State

Here are average DUI insurance rates by state. You’ll notice that the cost of insurance coverage after a DUI increases by an average of about 82%, from $1,490 per year to $2,725 annually.

StateAnnual RatesPercent IncreaseDUI Insurance Rates
 Alabama$152971%$2614
 Alaska$160548%$2375
 Arizona$1222219%$3898
 Arkansas$139959%$2224
 California$1962166%$5219
 Colorado$155854%$2399
 Connecticut$163866%$2719
 Delaware$158099%$3144
 Florida$183088%$3440
 Georgia$220175%$3852
 Hawaii$1400207%$4298
 Idaho$105363%$1716
 Illinois$137064%$2247
 Indiana$120276%$2116
 Iowa$105848%$1566
 Kansas$135875%$2377
 Kentucky$1503108%$3126
 Louisiana$197157%$3094
 Maine$96493%$1861
 Maryland$181012%$2027
 Massachusetts$160486%$2983
 Michigan$2551139%$6097
 Minnesota$136098%$2693
 Mississippi$138559%$2202
 Missouri$120753%$1847
 Montana$201362%$3261
 Nebraska$131778%$2344
 Nevada$138860%$2221
 New Hampshire$983110%$2064
 New Jersey$190594%$3696
 New Mexico$137168%$2303
 New York$117369%$1982
 North Carolina$1060321%$4463
 North Dakota$171057%$2685
 Ohio$92653%$1417
 Oklahoma$156875%$2744
 Oregon$133358%$2106
 Pennsylvania$144069%$2434
 Rhode Island$2020103%$4101
 South Carolina$131650%$1974
 South Dakota$155740%$2180
 Tennessee$139781%$2529
 Texas$162071%$2770
 Utah$119264%$1955
 Vermont$114963%$1873
 Virginia$111470%$1894
 Washington$149962%$2428
 West Virginia$251870%$4281
 Wisconsin$108776%$1913
 Wyoming$154161%$2481

Cheapest Car Insurance After DUI

Although DUI premiums differ by state, age, gender, driving history, and vehicle type, it does seem that certain insurance companies raise rates less than others. Although your specific circumstances may be different, we found that State Farm, Progressive, and Allstate consistently offered the cheapest car insurance after a DUI. However, we still recommend drivers compare quotes from multiple companies in their area to ensure they get the best insurance for a DUI.

StateCheapest Company
AlaskaState Farm
AlabamaState Farm
ArkansasState Farm
ArizonaState Farm
CaliforniaAllstate
ColoradoAllstate
ConnecticutState Farm
Washington, DCAllstate
DelawareAllstate
FloridaAllstate
GeorgiaProgressive
HawaiiState Farm
IowaState Farm
IdahoState Farm
IllinoisProgressive
IndianaProgressive
KansasState Farm
KentuckyState Farm
LouisianaState Farm
MassachusettsGEICO
MarylandProgressive
MaineState Farm
MichiganProgressive
MinnesotaProgressive
MissouriProgressive
MississippiAllstate
MontanaState Farm
North CarolinaState Farm
North DakotaState Farm
NebraskaState Farm
New HampshireProgressive
New JerseyState Farm
New MexicoProgressive
NevadaProgressive
New YorkProgressive
OhioProgressive
OklahomaState Farm
OregonAllstate
PennsylvaniaProgressive
Rhode IslandAllstate
South CarolinaState Farm
South DakotaState Farm
TennesseeGEICO
TexasState Farm
UtahProgressive
VirginiaProgressive
VermontState Farm
WashingtonState Farm
WisconsinProgressive
West VirginiaState Farm
WyomingState Farm
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Insurance After a DUI – Getting An SR-22 and FR-44

Buying car insurance for a DUI is costly, making it more important than ever to compare auto insurance quotes from multiple providers to get the best rates and coverage. But finding cheap DUI car insurance for high risk drivers isn’t as straightforward as shopping around.

In most states, you will need to provide the DMV with proof that you have obtained at least the minimum amount of coverage required to drive legally in your state. To do this, after you have selected and paid for DUI insurance, the insurer will send a form called an SR-22 or FR-44 to the DMV in your state. These are essentially forms that prove you have assumed the appropriate level of financial responsibility.

An SR-22 is a special filing attached to your policy in states other than Florida and Virginia. You can ask your insurance company to send the DMV an SR-22 when you purchase your high-risk policy, or you can purchase a non-owner’s SR-22 if you don’t own a vehicle.

A traditional SR-22 covers you when you drive your own car, but non-owner SR-22 insurance protects you when you borrow a car from family or friends, and in the event of an accident, your SR-22 non-owner’s insurance comes into play. Similarly, FR-44 forms are required only in Florida and Virginia, and it has an additional requirement that you must carry a minimum of $100,000 in liability coverage on your policy.

How Long Does A DUI Stay on Your Car Insurance?

Many drivers are curious as to how long they need to maintain their DUI car insurance and pay these higher rates. Most of the time, the laws in your state govern this. In most states a DUI will stay on your driving record for a period of about three years. And, as with most other traffic violations and convictions (including at-fault accidents), you can expect your insurance rates to remain high for at least 3 years.

In states like California, you cannot receive the standard 20% safe driver discount for a period of 10 years following a DUI conviction. Many other states require a DUI to remain on your driving record for a period of five to seven years, and your premiums will stay high during this time, even when you are no longer required to provide SR-22 or FR-44 forms to the state DMV.

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DUI Insurance Rates

DUI Insurance Rates

The actual increase in your premiums varies substantially from state to state. In some, rates may only increase by about 12%, but in others, increases as high as 100% are common. Some of the highest increases occur in states like California, Arizona, Michigan, Florida, New Hampshire, New York, Rhode Island, and Texas, while the lowest DUI insurance rates tend to occur in states like Alaska, Colorado, Iowa, Ohio, Maryland, South Carolina and South Dakota.

When your insurer finds a DUI on your driving record, this information is used in a proprietary algorithm that determines risk. Even within the same state, different companies calculate risk and premiums differently. This is why it is always a good idea to shop around for cheap DUI car insurance, even if you have been with your current insurance company for many years. You may find that you can save hundreds of dollars by making a simple switch.

It is also important to consider that many of the biggest carriers may consider you un-insurable with a DUI, particularly if it is not your first offense. In fact, you may receive a notice of cancelled coverage from your current insurer after your DUI. It can be difficult in this case to find another provider, and many drivers rely on non-traditional insurance companies in this case. Unfortunately, because the risk is so great, premium increases are always substantial no matter where you end up.

When you are no longer required to carry high-risk DUI car insurance, there is no guarantee that your premiums will fall back to your pre-DUI rates, either. The insurance company will ultimately decide your premiums and the risk you impose afterward. Most people find that while their premiums drop significantly at this time, they do not fall as low as the rates they used to get before a DUI or DWI. Once you are no longer considered high-risk, it is a good idea to shop around again to find the best cheap auto insurance rates.

Get The Best Car Insurance After a DUI

A DUI is certainly expensive in many ways, especially when it comes to your auto insurance policy. Shopping around for the best car insurance after a DUI is by far the best way to find the lowest rates, regardless of your state. Make sure you compare the coverage and premiums offered by each company carefully before making a decision.

Can You Insure A Car You Don't Own

Can I Insure A Car Not In My Name and That I Don’t Own?

Getting insurance on a car you do not own or that is not registered in your name can be tricky. While most drivers insure a car owned by them, in some cases, you may need to buy car insurance on a vehicle that isn’t yours. For example, if a parent buys a new car and passes their older vehicle to a child, he/she will still need to get their own insurance for it, especially if they don’t live together. And although the simple answer is yes, you can insure a car that’s in someone else’s name, the actual process of applying for a policy is more nuanced. This is because insurance companies look to see if you have what’s known as “insurable interest” in the vehicle.

Below, we’ll explain everything you need to know about insuring a car you don’t own, and how to go about putting someone else’s car on your insurance policy.

Can You Insure A Car You Don't Own

Insure A Car Not In Your Name

When insuring a car you don’t own, the main issue comes down to “insurable interest”. When you get car insurance on a vehicle you own, your financial interest is clear – you have a vested interest in the well-being of the car. This essentially means your interests and the insurer’s interests are aligned, so they trust you to take care of the vehicle and avoid accidents that may result in claims and payouts.

However, when you are not the owner of the car and the vehicle is not registered to you, the interest is not clear and must be established. After all, if you don’t have a financial investment in the car and it’s involved in a crash, you don’t stand to be liable for anything or lose any money.

For families where parents are gifting an old car to their kid who still lives at the same address, the simple solution is to just add the child as a driver on the policy. Nevertheless, in the event of an accident, liability ultimately falls on the registered owner, not the listed driver.

Otherwise, if the young adult lives at a separate address, parents may need to get the car co-titled. This can be easy to do if the vehicle is paid off, and simply requires a trip to the DMV where you will add the new driver to the car’s title. If there’s a loan on the vehicle, you may need approval from the lender or finance company.

State Laws May Stop You From Insuring a Car You Do Not Own

In specific states, like New York, registration and car insurance must be in the same name. For instance, New York requires you to have insurance when you register a vehicle in the state. Unfortunately, New York’s insurance laws also explicitly state that the name on the policy must match the name on the title and registration. Failure to match can result in the suspension of the car’s registration, meaning you can’t drive it without facing fines and penalties.

Ultimately, in the majority of states, the car title holder (owner) and named insured aren’t required to be the same person. This means it’s legally possible to take out an insurance policy on a car you don’t own. However, just because most states allow a non-owner to insure a vehicle doesn’t mean insurance companies support this action.

Car Insurance Companies May Not Pay Out Claims

Because many insurers leverage online applications to establish a new policy, it’s possible to only encounter a problem after filing a claim. Unless the online enrollment form requires owner-specific information, a policy may be established, but based on insurer policy regulations, may not be honored if the named insured differs from the vehicle’s registration. Prevent this unsavory scenario by confirming non-owner coverage restrictions before paying for a new policy.

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Can Someone Else Insure My Financed Car?

One of the biggest questions you may have right now is whether someone else can insure your financed car. Until a vehicle loan is fully paid, its title belongs to the lender. Legally, it’s generally acceptable for someone else to insure your car, but the process becomes difficult when the vehicle is still being financed. Because the driver doesn’t hold insurable interest in the car, it’s considered risky in the eyes of both the insurer and finance company. You will likely have to contact your auto loan company and find out if they would allow you to get insurance under your name.

This is because the finance company, or lien holder, usually requires the insurance policyholder be the same person who is responsible for paying back the loan. Since the lender claims the car as an asset until all payments are satisfied, the lien holder often requires acceptable proof of insurance under the name of the borrower.

In this situation, it’s possible for someone else to insure your financed car as a principle operator. While you’ll remain the primary policyholder, an authorized principle operator (or listed driver) will be covered under the policy.

It’s important to note that you will be responsible for ensuring premium payments are made, although in this case, the principle operator will be paying on your behalf or repaying you directly. Moreover, the primary policyholder is ultimately responsible for any losses that may occur if the vehicle is totaled or damaged.

How To Get Car Insurance For Someone Else’s Car

To establish a policy for someone else’s vehicle, you must first check with your insurance company. Even in states where this is allowed, some insurers may not allow the policyholder name to be different from the owner. However, there are several exceptions to this rule.

Parents and employers are typically allowed to establish policies for someone else. Keep in mind, buying a policy for someone else’s car often comes with higher monthly premiums than a traditional owner-based policy.

There are two ways to get insurance for someone else’s vehicle. These include:

  • getting non-owner car insurance coverage
  • buying a standard auto insurance policy

Non-Owner Car Insurance

Non-owner insurance is a unique policy option specifically designed for those who occasionally drive someone else’s vehicle and don’t have a car of their own. Typically, non-owner insurance offers liability coverage only, and policies rarely cover your own vehicle. For example, if you damage your car in an accident where you are at-fault, hit an animal while driving, or suffer losses from theft, vandalism, fire or other natural disasters, these claims aren’t covered by a non-owner plan.

The Car Owner Adds You To Their Insurance

The only exception is if the vehicle owner adds your name to their existing policy. To qualify for non-owner insurance, you cannot share the same address as the title holder and you cannot be the primary driver or operator of the vehicle.

Buying Standard Insurance Coverage

Purchasing a standard car insurance policy for someone else’s vehicle is more difficult than adding your name to an existing policy or establishing non-owner coverage. While requirements vary based on insurance provider, most insurers require proof of insurable interest.

Essentially, this documentation must prove financial loss if the vehicle is damaged. The International Risk Management Institute defines insurable interest as an official document demonstrating legal or financial risk. Unless the vehicle is registered in your name, meeting this requirement is often very challenging.

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Insure A Car You Don’t Own

Insuring a car you don’t own and that isn’t in your name isn’t as straightforward as a traditional auto insurance policy. While non-owner insurance is common, its liability-only coverage may not be robust enough for all drivers.

Regardless of your situation, always confirm the legalities, limitations and covered claims with the insurance provider. Failure to perform this necessary due-diligence may result in significant financial loss, or worse, being charged with insurance fraud.

To learn more about the different types of coverage offered by the best companies in the United States, enter your zip code and pick a provider. Instant insurance quotes online can save you time finding the best rates and plans from good providers.

Car Insurance with No Deposit

Very Cheap Car Insurance With No Deposit

Want very cheap car insurance with no deposit? Also known as zero down auto insurance, instant car insurance with no deposit offers you the option to buy coverage by paying monthly premiums instead of making an upfront payment for 6 or 12 months. Fortunately, there are many good car insurance companies that don’t require a deposit or some type of down payment for coverage – these insurers calculate their rates based on a pay-as-you-go system.

With so many US drivers struggling to save money but needing to drive to work, getting new car insurance with little to no deposit or through monthly installments may be a family’s only way to buy a policy. However, it is important to note that no deposit auto insurance doesn’t mean you’ll get free insurance.

If you need cheap car insurance now and want to pay monthly installments, here we’ll discuss how no deposit insurance works, the pros and cons of these popular policies, and how to find the lowest rates for coverage.

Car Insurance with No Deposit

What Is No Deposit Car Insurance?

No deposit car insurance is coverage that requires only the first month’s premium to obtain insurance. These types of policies allow drivers to pay their rates in one of two ways – through annual, semi-annual, or quarterly payments or through a monthly payment plan.

While some brokers, agents or companies try to market cheap car insurance with no down payment as a way to get free insurance for a month without paying any money upfront, the truth is that you can only initiate coverage by paying for the first month. Beware of any companies or agents promising “first month free car insurance” or other false advertisements as there will certainly be some fine print.

Ultimately, the “no down payment” part simply implies your car insurance rates only cover the first month instead of requiring a large lump sum premium charge.

It’s also important to note that, although monthly premiums may be the best way to buy car insurance for you, auto insurance companies that don’t require a deposit actually end up charging you more in the long run. Drivers who can afford to pay more upfront will get a discount, resulting in a lower total cost. If you can pay for 3-months, 6-months, or 12-months in advance, ask your insurer how much cheaper your car insurance can be.

Cost of Car Insurance With No Deposit

Here is the cost of car insurance with no deposit. To compare premiums at GEICO, we included the price difference between a driver who pays for 6 months upfront and the cost of insurance with monthly payments.

 
Deposit
Monthly Rates
Total Cost
Savings
Monthly Payment
$127
$132
$787
Lump Sum Payment
$751
$0
$751
$36

How much you would save with different insurance companies (e.g. State Farm, Allstate, Progressive, Farmers, Mercury, Liberty Mutual, Nationwide, etc.) depends on your driving history, age, gender, zip code, vehicle, the length of your policy, and other factors that affect rates. However, the average discount or savings is around 5% to 10% on a 12-month policy when premiums are paid upfront.

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Car Insurance Companies That Don’t Require A Deposit

Most car insurance companies that don’t require a deposit don’t often advertise the monthly installment plan, even if they offer it. This is because insurers prefer to get paid up front with a down payment to cover some of the risk of insuring you and your vehicle. Ask your agent if you can pay monthly to see if the option exists, but you’ll have to qualify for the plan nevertheless.

New drivers or owners of new, expensive cars will have a difficult time finding no or low down payment insurance because of the increased risk to their carrier. Moreover, drivers with bad credit will be required to pay more of their premiums up front. On the other hand, drivers with old, cheap cars may qualify for zero down car insurance.

To get the best, cheap car insurance quotes for a low or no deposit policy, we recommend drivers compare rates from multiple companies. After all, the only way to know you are getting the lowest premiums is to complete an insurance comparison. Just enter your zip code to find a list of the best companies in your area and receive a free, instant quote online.

States Where You Can Get Car Insurance With No Deposit

Unfortunately, purchasing auto insurance with no money up front isn’t an option in every state. Here’s a list of states where you can buy car insurance with no deposit.

  • Arizona
  • California
  • Florida
  • Georgia
  • New York
  • Oklahoma
  • Washington

For cheap car insurance today, compare quotes, companies, policies, and terms to find the lowest premiums and best coverage for your situation.

Cheap Full Coverage Car Insurance

Cheap Full Coverage Car Insurance

If you’re considering full coverage insurance, it’s important to know what it is and how much it may cost. Finding cheap full coverage car insurance isn’t impossible. While how much full coverage insurance costs depends on your age, gender, driving history, state, insurance company, and deductible, the average cost of full coverage auto insurance can range from expensive in California, New York and Connecticut to affordable in Texas, Ohio and North Carolina. Similarly, average full coverage insurance rates vary between companies, with GEICO charging $110 per month, State Farm charging $117/month, Allstate priced at $134/month and Progressive quoting $139.

In the end, getting the best and cheapest full coverage insurance comes down to shopping around and comparing prices, policies, and carriers. After all, if you have a clean driving record and quality for multiple discounts, then your rates should be below the average.

Below, our guide will explain exactly what full coverage insurance means (e.g. comprehensive and collision), the factors that will affect your premiums, and ultimately how to get the best full coverage car insurance for your needs.

Cheap Full Coverage Car Insurance

What Is Full Coverage Auto Insurance?

Many drivers think full coverage auto insurance means they are completely covered and protected. Unfortunately, the term is misleading since the term “full coverage” generally refers to collision and comprehensive insurance, which are types of coverage added onto your liability insurance policy to protect you against specific risks and incidents.

If you’re buying a new car and need a loan, your lender may require you to have full coverage on the vehicle. This is because states only require you to have liability insurance, which pays for claims, repairs, and medical costs for other people, but not for yourself or your own property. This is where collision and comprehensive insurance fill the gaps – by paying out claims to repair your car even in an at-fault accident.

Here’s what full coverage car insurance actually includes:

  • Liability insurance. In most states, there is a required minimum amount of liability insurance coverage that must be maintained by drivers. In an at-fault auto accident, liability insurance pays for the other driver’s bodily injuries as well as for repairs to their property. Liability protection does not pay for your medical bills or repairs to your car.
  • Collision insurance. With collision coverage, you have protection that pays for your car’s repairs even if you cause the crash with another vehicle or object.
  • Comprehensive insurance. Comprehensive coverage extends your vehicle’s protection beyond wrecks and covers you for non-accident related incidents and costs, such as theft, vandalism, weather, fire, animals, falling objects, etc. What your comprehensive insurance protects you against is detailed in your policy.

As you can see, because full coverage auto insurance does a much better job of protecting you against a variety of damages and injuries, it is naturally going to cost more. However, this doesn’t mean you can’t find affordable rates if you know where to look.

How Much Is Full Coverage Car Insurance?

At this point, you may be wondering how much is full coverage insurance going to cost, and surprisingly, not as much as you would think. If you have an auto loan and still owe money on your vehicle, your lender will likely require you to have full coverage to ensure they protect their investment.

However, unless you can find affordable comprehensive and collision insurance coverage, adding this coverage to your policy only makes sense if you absolutely need it. And getting low cost full coverage auto insurance is going to be a lot more feasible if you have a clean driving history with no accidents or speeding tickets.

To give you an idea of premiums around the country, here’s the cost of full coverage insurance in California, New York, Texas, Florida, Massachusetts, New Jersey, Georgia, and Michigan.

City
Liability Insurance
Full Coverage
Atlanta, Georgia
$876
$1,470
Boston, Massachusetts
$984
$1,546
Houston, Texas
$1,034
$1,618
Miami, Florida
$1,098
$1,712
Los Angeles, California
$1,128
$1,676
Newark, New Jersey
$1,353
$1,925
New York City, New York
$1,380
$2,340
Detroit, Michigan
$2,551
$4,638

If you’re in the market for a new car, then you’ll want to compare full coverage car insurance quotes to start planning your budget. Depending on the vehicle you want to purchase and your current insurer, you may need to switch companies to get the cheapest rates on full coverage.

Where To Buy Full Coverage Car Insurance

While full coverage auto insurance is generally available from any carrier, we reviewed the average prices from the largest insurance companies. For a policy that includes liability, collision, comprehensive, and other state-mandated coverages, here’s what each provider charged.

Company
Average Rates For Full Coverage
GEICO
$110/month
State Farm
$117/month
Allstate
$134/month
Progressive
$139/month

As one of the cheapest car insurance companies in the United States, it’s no surprise that GEICO offered the most affordable rates with the best coverage. Nevertheless, the other largest insurers in the country weren’t far behind with relatively low-cost policies as well.

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Factors That Affect The Cost of Full Coverage Car Insurance

There are several factors that can influence how much full coverage auto insurance costs. Here’s what will affect the cost of your full coverage.

  • Your age and gender
  • The make, model, and year of your vehicle
  • Where you live – city and state
  • How often and how far you drive each year, on average
  • The number of accidents and tickets you have on your driving record (if any)
  • The deductible you choose on your policy (a higher deductible will get you lower premiums)
  • Your insurance company and how it calculates risk and prices
  • The discounts you qualify for (e.g. loyalty, multi-car, multi-policy, safety features, etc.)

In addition to the basic liability, collision, and comprehensive coverage, it is possible to add even more options to your policy. Some of these additional coverages can include:

  • Uninsured Motorist Coverage – If you are hit by a driver who has no auto insurance, uninsured motorist coverage can help you with damages, repairs, and medical bills.
  • Underinsured Motorist Coverage – Similar to uninsured motorist coverage, underinsured motorist coverage can help pay your expenses if you are involved in an accident with a driver who does not carry enough protection to cover your claims. This can help when the other driver has only purchased the minimum amount of liability insurance required by the state, but the severity of the accident necessitates higher limits.
  • Emergency Roadside Assistance – If your vehicle should break down and need emergency maintenance or towing, emergency roadside assistance can help you pay for some or all of these costs.
  • Rental Vehicle Reimbursement – If your vehicle is being repaired following an accident, it may be necessary for you to rent a car. Having rental vehicle reimbursement coverage can help you to pay these costs, typically up to a maximum time period.
  • “Gap” Insurance Coverage – With gap coverage, if your vehicle is totaled in an accident, this can help you pay the balance between the amount that you owe on an auto loan or lease, and the vehicle’s estimated actual cash value. Because your insurer is only required to pay out the value of your vehicle, there is sometimes a gap between how much your car is worth and how much you owe on it. Gap insurance makes up the difference.

Each of these added insurance options will also typically increase your premiums. However, they could also end up saving drivers hundreds or thousands of dollars in out-of-pocket expenses when they are needed.

Full Coverage Insurance

Who Needs Full Coverage Insurance

Because most states do not require full coverage, not all drivers should get it. In fact, if you have an old vehicle that isn’t worth much, you definitely shouldn’t purchase this additional protection.

Comprehensive and collision coverage insurance makes the most financial sense if:

  • You own a new or expensive car.
  • You commute in heavy traffic and think there is a high probability of being involved in a car accident that is not your fault.
  • You leave in an area with extreme weather, high rates of car theft, or lots of collisions involving animals.

Just be prepared for your rates to go up if you live in high-risk areas. This is when completing an insurance comparison is the most critical.

How To Get Cheap Full Coverage Car Insurance

Although there are many factors and formulas that determine the price of collision and comprehensive insurance, there are ways to get cheap full coverage insurance. For instance, while some items such as your age and gender can’t be changed, you can make it a priority to practice safe driving habits. A clean driving history coupled with a safety driving course can lower rates. Furthermore, you can choose to insure the new car under the least risky driver in your family.

There are also a number of discounts you could ask for. For example, some carriers provide multi-policy discounts, which is when you have more than one policy with the company (e.g. both your auto and your home insurance is insured with the same provider)

Similarly, carriers may also provide a discount if you have gone for a certain period of time without having a ticket or an accident. If your new car comes with various safety features such as air bags, anti-lock brakes, daytime running lights, an anti-theft system, adaptive cruise control, lane-departure warning systems, collision-avoidance systems, an electronic stability control system, etc.

Compare Full Coverage Insurance Quotes

In order to find affordable full coverage auto insurance, it can be beneficial to compare your coverage options with free quotes online from several different companies. With side-by-side comparisons of the policies and premiums, you can choose the insurer offering the best full coverage for your budget.

New Car Insurance Grace Period

New Car Insurance Grace Period – Buying Auto Insurance For A New Car

Buying car insurance for a new car can be a tricky situation. While all states require drivers to have some type of auto insurance coverage for their vehicles, you’re probably curious about whether state laws and regulations provide a new car insurance grace period to ease the purchase and transition. However, the truth is that state auto insurance rules don’t grant any grace period by law, but most insurance companies (e.g. State Farm, GEICO, Progressive, Mercury, AAA, etc.) do give drivers buying a new car 30 days to get their vehicle registered and insured.

Understanding when to get insurance on a new car is critical to protecting your purchase. Obviously, this can help to ensure that you won’t have to pay a large sum out-of-pocket for liabilities, repairs, medical costs, and damages if your involved in a car accident after driving away from the dealership.

Below, we’ll discuss whether a new car is insured or not, how soon after buying a car do you need insurance, how much that coverage will cost, and all the details you need to know about this getting new auto insurance.

New Car Insurance Grace Period

When Do You Have To Insure A New Car?

When to get insurance coverage on a new car can actually depend on a couple of factors, starting with whether or not you currently have a policy on your existing vehicle. For instance, in many cases, if you have insurance on a vehicle that you traded in for a new one, your existing policy may provide coverage on the new car – but only temporarily.

Typically, this temporary coverage will last from 7 to 30 days. This is called the new car insurance grace period – a time where you are technically covered but you need to quickly buy coverage as soon as possible to avoid potential issues with your insurer.

But even so, while you may not need to inform your insurance carrier immediately of the change in vehicles, it is important to do so sooner rather than later. That way, you’ll have coverage that matches up to the specific vehicle in case of an accident.

New Car Insurance Grace Period – How Much Coverage Do You Have?

In addition to the grace period for coverage, there are also some other key pieces of information that you should be familiar with when it comes to transferring your auto insurance to a new car.

For instance, you should check on how much coverage you will have during the transition period. As an example, depending on the insurer and your state of residence, the replacement coverage could be the same as the coverage you had on the vehicle that you sold or traded in for you new car.

For instance, Texas insurance companies only give a newly purchased car the same amount of coverage as the vehicle on your policy with the most coverage. This means that if one vehicle has liability only and another has full collision and comprehensive coverage, then the third car will have full insurance as well.

However, in some states, your new car will automatically be provided with comprehensive and collision coverage (for a certain number of days), even if your other vehicle only had liability coverage. This can make a major difference in protecting you since liability insurance pays out other drivers if you are at-fault, while full coverage auto insurance also protects and pays you for injuries, damages, and repairs.

Buying Car Insurance For A New Car

Getting new car insurance is really easy if you already have coverage. To buy insurance on a new car, simply call your company or agent and let them know you’ve purchased a vehicle. Make sure to know the new car’s make, model, trim and year as well as any safety features that may lower your auto insurance rates.

Policyholders should also make sure to remove the car that was traded-in or make it absolutely clear that no trade-in occurred and to keep the other vehicle on the policy.

If you’re buying your first car and you don’t currently have insurance with any company, you may need to shop around, compare rates, and line up coverage before visiting the dealership to complete the transaction for a new car. While you don’t already need to buy insurance before you purchase your new car, knowing which company you plan to use and calling from the dealership while filling out paperwork is the best way.

Nevertheless, we recommend you do your research before getting to that point. It’s very important to combine the best insurance company and coverage with the cheapest rates to avoid overpaying.

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Car Insurance For New Car

How Much New Auto Insurance Coverage Should You Buy?

The kind of car you buy can often dictate the type and amount of auto insurance coverage that you need. For example, it may make sense for older vehicles to have only the state-mandated amount of liability coverage. This can help with keeping your premiums low.

However, if you have purchased a brand new car, then a policy that includes collision and comprehensive coverage is generally recommended. In fact, if you have taken out a loan in order to finance your new car, then the lender will oftentimes require that you have full auto insurance coverage. This additional protection ensures the lender gets their money back, even if the vehicle is totaled or heavily damaged in an accident.

How Much Is Insurance For A New Car?

When you purchase a new car, your insurance coverage can vary so it’s important to be familiar with the grace period and the type of protection that will transfer, based on your specific situation.

In any case, it is always a good idea to compare auto insurance quotes before you commit to a more permanent policy. That way you can take a closer look at various coverage options, as well as comparison shop quotes from different companies to choose the one that best fits your needs and your budget.

If you want to know exactly how much is insurance for a new car, enter your zip code, pick an insurer, and get a price quote. After going through the process with a few providers, compare rates and types of coverage, and call the one offering the best deal to ask about additional discounts. While buying new car insurance may seem like a hassle, doing it right and finding lower rates can save you hundreds, if not thousands, of dollars each year.

Types of Car Insurance Coverage

With so many different types of car insurance coverage, it’s important that drivers understand the policy they are buying. Auto insurance is mandatory in almost every state in the United States, the District of Columbia and Puerto Rico, with the exception of New Hampshire. Each state and jurisdiction makes its own determination of which types of insurance, options, and policy limits are required to meet their state’s minimum car insurance laws. Most states require liability insurance, but in some states with no-fault regulations, liability coverage is optional. Other forms of coverage, such as comprehensive, collision, GAP, and personal injury protection, are offered as additional policy options.

In this comprehensive guide, you will learn about all the types of car insurance available. Consider this “Car Insurance 101” and your first step to learning how to compare policies, companies, rates, and quotes.

Types of Car Insurance Coverage

Liability Car Insurance

“Liability” is a legal term which refers to fault, or being responsible for a debt. In the case of auto insurance, liability arises out of a negligent act or omission by an insured person which causes damage or injury to a third party. A negligent act could be speeding in a school zone and an omission could be failure to stop at a stop sign or red light. Simply put, liability car insurance offers you protection in the event of an at-fault accident.

If an accident which causes damage to a party occurs as a result of these circumstances, the insured driver is legally obligated to pay for the party’s incurred damages. It should be noted that deliberate acts with the intent to cause bodily injury or damage are excluded by liability coverage.

Liability auto insurance is an agreement by the insurance company to assume your legal obligations and expenses in a covered car accident, up to the limits of your policy. In the case of auto repairs, your carrier will pay the mechanic or body shop for parts and services rendered. For litigation, the company stands in your place, hires attorneys to defend legal actions by third parties and pays for your legal costs. If your litigation costs exceed the limits of your policy, you are then personally responsible for the excess amount and those become “out-of-pocket” expenses.

Liability Limits

There are two components of liability coverage: bodily injury (BI) and property damage (PD). Although liability can be bought as a single limit to cover all losses in an accident, it is most often sold as separate coverages with separate limits.

Bodily Injury

Bodily injury coverage (BI) pays third parties injured by your negligence for medical expenses and bills, lost wages, pain and suffering and permanent disability. The limits of bodily injury are usually shown separate, for example 25/50. This means your carrier will cover a maximum claim of $25,000 for each person injured in an accident with a maximum of $50,000 to cover all persons injured in the accident.

Property Damage

Property damage liability coverage (PD) is a single limit amount for each accident, although it may be shown as the last number with the BI limits as 25/50/10. The first two figures represent the limits on bodily injury, while the last indicates this policy offers $10,000 in property damage protection for each accident. Property damage can include cars, houses, street signs, fences or any other property, public or private, damaged in a car accident for which you are at-fault.

Is Mandatory State Minimum Car Insurance Enough?

Since you are still financially responsible for claims which exceed the limits of your policy, state minimum car insurance is often not enough to fully protect you and your assets. Anyone with financial assets, such as cash, equity in a house, an investment portfolio or even a healthy bank account, should buy more than the minimum state requirements.

High-income households or individuals who earn reasonably high salaries should consider that courts may garnish income to satisfy court-ordered judgments or settlements arising from auto accidents. This is another reason drivers should carry enough liability insurance to protect their future earnings, but does not mean you need to buy a $1,000,000 plan.

Comprehensive Insurance

Comprehensive insurance pays for damages to your vehicle caused by theft, vandalism, arson, acts of God, natural disasters (hail, fire, floods, and/or earthquakes) and collisions with wildlife (deer) or livestock. Comprehensive coverage does not pay out for claims related to an auto accident unless the accident occurred while your car was stolen.

Although comprehensive car insurance is not mandatory, it is often required by banks and lenders as a condition for a car loan, new or used. Comprehensive policies will best benefit drivers with a financed or leased car, or a newer vehicle in good condition that you may want to replace or repair in case of loss. Comprehensive coverage is not beneficial for drivers with older cars that have low replacement values.

Comprehensive Insurance Deductible

You may choose a deductible amount between $250 and $1,500. You will have to pay the deductible when your claim is approved in order for the car insurance company to pay the rest of the claim. For example, you choose a $1,000 deductible and your car sustains $1,500 in damages, you will pay $1,000 out-of-pocket and the company will pay $500. Generally speaking, higher deductibles mean cheaper rates.

Collision Insurance

Like comprehensive coverage, collision insurance is optional and may be required by a bank or lender as a condition for an auto loan. Collision coverage protects and pays out on claims relating to your vehicle during a collision or accident with another car or stationary object. Similar to liability and comprehensive, collision also forces you to choose a deductible.

Collision insurance pays for the repair or replacement of your vehicle regardless of which driver was at fault for an accident. Although neither the collision nor comprehensive option is state-mandated, insurance companies may be legally obligated to notify the lender who financed or leased your vehicle if the coverage lapses.

A lapse in full coverage car insurance (meaning all 3 types of protection) could void the loan agreement and result in repossession of the vehicle. The deductible for collision insurance works the exact same way as it does for comprehensive coverage, and benefits the same types of drivers – ones who lease or finance their cars and want to protect their vehicles from total loss.

Uninsured / Underinsured Motorist (UM and UIM)

Uninsured motorist coverage is mandatory in 20 states. It acts as liability protection against other drivers who have no insurance. Your auto insurance company will pay for your repairs, litigation expenses, medical bills, lost wages, and pain and suffering if the other driver is at-fault, but does not have car insurance.

The other uninsured driver can still be held responsible for damages and may have to reimburse your carrier for their payments. All legal penalties for driving without insurance are still assessed against the uninsured driver. UM and UIM coverage is intended to provide protection for you, the policyholder, not for the uninsured driver breaking the law.

In some states, the UM/UIM policy add-on can be used as a supplement when the opposing driver involved in an accident did not buy high enough limits to cover all of your expenses. If the other driver’s liability limits are exhausted, you can submit a claim against your own provider for the balance. Your carrier will payout and cover the difference.

Uninsured Motorist Limits

In most states, the limits of UM policies are equal to liability limits. If you have a $50,000/$100,000/$50,000 policy, the uninsured motorist coverage limits would be UM-BI $50,000/$100,000 and UM-PD $50,000.

UM/UIM Deductibles

The property damage portion of UM coverage does have a deductible which must be paid. As a rule, the deductible on this part of your policy is lower than the deductible on collision and comprehensive insurance. If your carrier is able to recover a portion of the claim from the other party, they will refund you the deductible.

Personal Injury Protection (PIP)

Personal injury protection (PIP) insurance covers you, family members living in the same household, and passengers in your vehicle. Personal injury protection pays for medical, hospital, and funeral expenses, without regard to fault. PIP coverage may extend in some states to cover pedestrians or passengers in another car.

As a rule, PIP is attached to you, the policyholder, and reimburses for injuries incurred in most types of auto accidents. Some no-fault statutes cover all injuries arising from the use, ownership or maintenance of a vehicle. Under these laws, medical bills for an injury sustained while changing a tire are covered under PIP insurance, too.

Who Is Covered?

  • The policyholder (you)
  • Your relatives living in the same household
  • Passengers in your automobile
  • Other authorized drivers on the policy
  • In some states, the policyholder and family members when injured riding in someone else’s car as a passenger

Currently, 12 states have no-fault laws and the provisions of the laws vary widely between the states. PIP insurance coverage pays medical bills arising from an auto accident up to the policy limits in all twelve states, but not all the states have provisions for other losses, such as lost wages or essential services benefits which cover the expense of hiring someone to perform household tasks while an insured is disabled.

Some states even provide for funeral expenses and have a death benefit while others do not. PIP is mandatory coverage in most states with no-fault laws, but may not be mandatory in states with no-fault choice laws.

In the states where no-fault insurance is mandatory, health insurance companies may not pay for medical bills arising out of a car accident covered by PIP insurance, since in these states, PIP coverage is considered to be the primary medical coverage. As a result, you are not allowed to submit a claim and collect a payout under two different policies (auto and health) for the same medical expenses. However, in certain cases, one may supplement the other.

Medical Payments Insurance

Medical payments insurance is an optional coverage offered in states where personal injury protection (PIP) is not mandatory. You select the policy limits, which are typically between $1,000 and $5,000. Medical payments coverage pays for medical bills arising from a vehicular incident. The bills may include emergency room treatment, x-rays, doctor visits, necessary prescription drugs and other medical costs up to the policy limit.

Persons covered by medical payments insurance coverage include you, members of your household and passengers in your car. The policy limit is applied per person, so each covered person would have their medical bills from an accident covered up to the policy limit. Unlike PIP insurance coverage, you can collect under both medical payments and health insurance coverage in most cases.

How No-Fault Accident Laws Work

Under pure no-fault accident state laws, each party assesses their own damages and collects retribution from their own insurance company, with no right to sue or litigate against another driver. Unfortunately, no state has pure no fault regulations, although some states like Florida and Massachusetts limit the rights of parties to make claims against other drivers for injuries or damages.

In some limited claim states, the medical bills of an injured person must exceed a certain amount, for example $2,000, before that party can file a lawsuit against another driver. Other limited states restrict tort claims to people whose injuries are permanent, disfiguring or disabling.

Meanwhile, other states allow individuals to choose the option of suing a third party for injuries at the time they buy their auto insurance. These are called “choice” states and you can receive cheaper quotes in exchange for legally relinquishing your right to make an injury claim against a responsible third party. If you give up the right to make a claim against others, you gain the right not to have any tort claims made against you for auto accidents. New Jersey, Kentucky and Pennsylvania all have this combination of no fault and tort law for claims.

Since each state has vastly different and intricate no-fault laws, drivers in each state should review their policies or ask their representatives to understand the provisions of the laws in their state. To illustrate my point, New Jersey’s law is among the most liberal with coverage for medical bills, lost wages, essential services, funeral expenses and a death benefit. On the other hand, Florida’s basic PIP insurance only covers medical bills up to $10,000.

PIP and Commercial Vehicles

Some no-fault statutes limit PIP coverage to private passenger vehicles. Private passenger vehicles cannot be used for commercial purposes such taxis and limos or delivery vehicles. Vehicles with commercial registration are automatically excluded from PIP.

Vehicle owners should be aware that most private policies contain exclusions for commercial use of a personal vehicle and this includes delivering pizzas or newspapers for compensation. Individuals who use their private vehicles for commercial purposes must have this option checked on their policy, either personally or through their employer, or they may be in violation of their state’s laws. The exclusion applies in all U.S. states.

GAP Insurance – Loan/Lease

GAP insurance is another type of optional coverage for individuals who have a car loan or lease. Without GAP insurance, in the event that your car is a total loss, your carrier is only required to pay the actual cash value of your vehicle. Unfortunately, due to the depreciation of cars and the interest on the auto loan, the balance owed on the loan may be more than the actual cash value of the car. This may require you to make a lump sum payment to your lender or continue making monthly installments even though you are not driving your vehicle because it is totaled.

GAP insurance requires your provider to pay the difference between the actual cash value of the vehicle and the balance of the loan so you aren’t liable. GAP avoids an out-of-pocket expense. With GAP insurance, car owners don’t end up making loan payments on cars they no longer own or can’t drive due to damage. It does not pay finance charges or excessive wear and tear charges on leased vehicles.

This option may be purchased as a separate rider (add-on to your policy), but it is usually less expensive to add it as an endorsement to an existing contract. Most standard insurance companies offer a GAP endorsement, but some carriers that specialize in minimum limits may not, forcing you to buy the coverage separately.

Custom Car Insurance – Custom Parts and Equipment

Custom car insurance can be added to a policy with comprehensive and collision coverage and is used to cover non-factory or after-market parts and equipment such as stereos and sound systems, rims, high performance engines or parts, custom paint jobs, decals, truck bed liners, camper tops, specialty lights and other legal after-market items. Items which are not legal in a jurisdiction, which may include tinted windows or undercarriage neon lights, are not protected or reimbursed.

Emergency Roadside Assistance – Towing and Labor

Emergency roadside assistance coverage is offered through both automobile clubs (AAA) and auto insurance companies. Towing a vehicle following a loss covered by collision or comprehensive insurance is included. Emergency roadside assistance pays for towing, lock outs, roadside breakdowns, flat tires, dead batteries or even running out of gas. Labor, service and parts are provided without charge.

Roadside assistance generally has a monetary limit which varies between policies, but most allow up to $100 per incident and no more than 3 incidents per year. Emergency roadside assistance may be purchased on polices which do not carry collision or comprehensive insurance as well.

Rental Car Insurance

Rental car insurance can be broken down into two categories – reimbursement and protection for you when driving a rental car.

Reimbursement

Comprehensive insurance pays for a rental car for up to 30 days following the theft or damage of your vehicle. Most companies offering rental car insurance contribute a limited amount towards a rental car while your vehicle is being repaired. Rental car reimbursement can only be purchased on policies which have collision and comprehensive coverage.

Some car insurance companies have agreements with rental agencies which bill the insurance company directly. In these situations, the cost of the rental is covered in full for a period of up to 30 days. Otherwise, your carrier may simply reimburse you directly, per the guidelines set forth in your contract. Rental reimbursement may not cover the full amount of your rental and may require an out-of-pocket payment so be wise on how much you spend.

Coverage On Rental Cars

Many drivers are unaware that if they rent or borrow a car, their existing policy transfers coverage to the rental car. Standard insurance policies usually have a clause which states that if your car is disabled, a temporary replacement vehicle will be covered with the same insurance as your actual car.

If your automobile is undergoing repairs, even those that are not covered under your policy, your insurance company will cover a rental or borrowed car during the time your car is out of commission and not in-use.

Pet Insurance

Americans love their pets and often travel with them in the car. Veterinary bills for injured animals can be almost as expensive as healthcare costs for humans, and some carriers have begun offering pet accident insurance as part of an auto policy package. As a rule, accident-only pet insurance covers veterinary expenses incurred as a result of an injury to a pet from a car accident.

There is a limit on the total amount of expenses, which may be as low as $500 or as high as $5,000. These endorsements may be offered free as an incentive for consumers to purchase their auto insurance from a particular company. Otherwise, the policyholder can request the pet accident insurance as an addition to his/her policy. Not all providers offer pet insurance.

Umbrella Policies

Umbrella or excess insurance policies are not specifically auto policies. Instead, umbrella insurance offers liability coverage in excess of the limits of any liability insurance held by you, including auto, home, life, health, renter’s, and boat insurance. Should an injured person make a claim exceeding the liability limits of your auto insurance policy, your umbrella protection would cover the additional amount of the claim up to the umbrella policy limit. Umbrella insurance can range from $250,000 in coverage to millions.

When a claim exceeds the limit of the primary insurance policy, the company will notify you regarding your potential exposure. You must then notify your umbrella insurance company of a potential claim. This essentially means you will have 2 companies working to protect you. The umbrella insurer will provide legal representation and pay the amount of a legal judgment not covered by the primary liability insurance policy, up to the limit of your policy. For instance, if you bought $100,000 worth of liability protection in your auto policy and $500,000 in your umbrella contract, a $250,000 judgment against you would exhaust your auto policy and your umbrella would pay out the remaining $150,000.

Insurers who provide excess coverage may require that the primary policy have a liability limit of a certain amount before agreeing to underwrite the excess coverage. As a rule, excess or umbrella insurance is cheap compared to primary liability policies since it only covers claims that exceed the first policy, therefore posing less risk of loss to the insurance company.

Car Insurance Coverage

Choosing the right car insurance coverage is part of financial planning. Understanding what types of coverage and policies are available and which are necessary to provide enough protection is important. Mandatory state minimum car insurance does not provide enough coverage for most U.S. drivers seeking to buy adequate car insurance. To find the best car insurance, always research and compare policies, companies and rates before purchasing coverage.

Cheapest Car Insurance For Teens 2019

Finding the cheapest car insurance for teens can be a challenge – one that can require parents to compare quotes and coverage from multiple companies before settling on the best policy. Most teens will get their driver’s licenses at some point between 16 and 18, and few parents or families really prepare in advance even though planning can help save on car insurance for young drivers. But it’s never too late to get the best car insurance for new drivers.

There are several ways to get cheap car insurance for teens, including discounts for young drivers who will be on their parents’ policy. A little research can help parents find the best car insurance company for teenagers before they add a son or daughter to their coverage. Here’s how to buy the best and cheapest car insurance for young adults.

Cheap Car Insurance For Teens

Finding The Right Auto Insurance Company

Not all car insurance companies offer teenagers discounts, so shopping around and asking questions is a good idea. It is important to realize that even the best auto insurance companies calculate rates differently, which is why a car insurance quote comparison will yield varying premiums.

One insurance company may specialize in insuring high risk drivers with DUIs and multiple traffic violations, while another carrier may prefer customers with clean driving records, no accidents or violations, and high credit scores. For this reason, picking the right insurer that provides cheap car insurance for young drivers is critical to finding low premiums, which is why we recommend comparing car insurance quotes, coverage, and rates online. It is frankly the only way to know who provides the best, affordable rates.

Multi-Policy and Multi-Car Discounts

Furthermore, combining other policies such as life, homeowners, boat and/or RV insurance with the same carrier will help parents save money on all their coverage needs as well as take advantage of the discounts for teen drivers when they add their student driver to the policy.

Raise Your Deductibles

Raising your car insurance deductibles can lower your rates no matter who you are – a teen driver, adult, or senior. Most insurance policies come with a standard $500 deductible. Increasing your deductible from $500 to $1,000 prevents you from filing small claims and ruining your “No Claims” bonus, resulting in companies rewarding you with cheap quotes.

Good Student Discounts

Quite a few insurance companies offer “Good Student Discounts”. Since young drivers do not have a driving record or history, carriers need to use other indicators to calculate and determine risk. Good students with good attendance at school demonstrate more responsibility than students with poor grades and poor attendance, therefore students with GPAs of at least 3.0, or a “B” average, may qualify for a “Good Student Discount”, which can save their parents’ as much as 15% on car insurance.

Working or Volunteering Can Lower Rates

A clean driving record demonstrates a responsible attitude, but with no driving record to check, other indicators of responsibility can help teenagers keep their rates low. A good work record or employment history at a weekend or after-school job, or volunteering several hours a week for community service shows a good attitude and a sense of responsibility.

Insurance companies and colleges look for many of the same qualities in young adults, so parents can help teens prepare for driving and college at the same time. Cheap car insurance can also allow parents to save more towards college.

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Drivers Education Classes

Most high schools offer drivers education classes for student drivers. These driver-safety courses prepare students to take the written exam and road test for their permit or license. In addition, many car insurance companies offer discounts to teens who successfully complete a high school driver’s education program.

If a teen’s school doesn’t offer a safety program, signing up for a course at a private driving school may qualify you for the discount. Just make sure to ask your insurance company in advance.

Defensive Driving Discounts

In several states, car insurance companies provide a 10% discount for drivers who complete a defensive driving class. By requiring their kids to take the defensive driving class, parents can make their own car insurance quotes more affordable, and in some states, lower their teen’s rate as well. Defensive driving classes are cheap, take about 8 hours to complete and keep rates low for up to two years.

Choose The Right Car Insurance Coverage

Optional coverage like collision and comprehensive can be expensive when adding a teen to a policy, so if mom and dad are driving new cars, it may be a worthwhile investment to buy an older sedan or compact car for a teen. Liability-only coverage for old vehicles is cheap compared to full-coverage for luxury or sports cars.

If you’re trying to save money on car insurance, don’t ever place your teen as the primary driver for a new car with full-coverage and a $500 deductible. Research the different types of car insurance before choosing the right one for your family.

Should A Teenager Have His Own Insurance Policy?

If a teen is a minor, he/she may have to be on the parents’ policy. Usually, it is cheaper for teens living at home to be on their parents’ policy since most companies offer discounts, such as multi-car or multi-policy discounts that lower the rates for the entire family.

If a teen is over 18 and not a full time student, parents must decide if the teenager should find and pay for his/her own auto insurance policy. However, a better option would be to include the young driver on a parent’s policy and have him/her pay the premiums. It’s a win-win for everyone involved.

What If A Teenager Gets A Traffic Ticket?

For a teenage driver, a traffic ticket can increase car insurance rates significantly. In some states, if a driver is cited for a moving violation, he/she may opt to attend traffic school and have the ticket removed from their driving record. This maintains a clean history and low rates. In states where traffic school is an option, the one-time fee for traffic school is a lot more affordable than 2 or 3 years of higher premiums.

Parents With Preferred Rates

Parents can save money on car insurance for teenagers if they themselves qualify for preferred rates. Parents who maintain a clean driving record and a good credit score qualify for the lowest rates. When parents secure preferred rates, their teen driver’s premiums are usually lower, too. This can also set a good example for children who learn that good driving habits and financial responsibility save money.

Teens or Students Living Away From Home

If your young driver is over 18 and a full-time student living in a college dorm more than 100 miles away from home, he can stay on your insurance policy. Just call your company, let them know your child is away at college and you will earn a huge discount on your premiums.

If your child is not a full time student, is employed full-time, and living on his own, he will probably have to buy protection independently.

Teenagers or young drivers who are members of the Armed Forces maintaining their parent’s home address as their own usually qualify to be added to a parent’s policy.

Teens In the Military May Qualify For Discounts

Although not all insurers offer special discounts for members of the U.S. Armed Forces, many car insurance companies do provide discounts to members of the military. If a teen or young adult in the military is still insured on their parents’ policy, the parents should ask about military discounts. If a teen is out of the country on active military duty, parents should notify their company since the teen is not driving the car on a regular basis.

Safety First

While finding and keeping premiums low is important, the safety of teen drivers is paramount. Buy your young driver a safe car with a high safety rating. Insurance companies check to make sure vehicles have a variety of safety features such as airbags, anti-lock brakes, traction control systems, and alarm or anti-theft systems.

Cars with side curtain airbags provide protection from head injuries. Anti-lock brakes and other safety features help teens avoid accidents, and companies often reward high safety-rated make and model vehicles with affordable car insurance.

Compare Car Insurance Quotes Online

Planning ahead, getting all the right discounts and comparing free car insurance quotes from different companies can help families find cheap auto insurance for teenagers. Even if you aren’t interested in switching carriers, just increasing the deductible on collision and comprehensive coverage can save money, and it’s free to find out how much the savings may be.

Complete a car insurance rate comparison today and see how good grades, a safe car, defensive driving programs and various other discounts can get your family cheaper coverage.

Car Insurance With No Down Payment

Car Insurance With No Down Payment

Looking for cheap no down payment car insurance? Many U.S. drivers simply can’t afford to buy car insurance with a down payment, and therefore need coverage that offers them the option to make a low down payment or no down payment at all. Getting cheap car insurance with no down payment is not difficult when you compare auto insurance quotes online to find companies who offer these policies and payment options.

Below, we’ll discuss no money down auto insurance, the states and companies that don’t require a deposit, the pros and cons of these types of coverage, and finally, how to buy cheap car insurance with no upfront payments.

Car Insurance With No Down Payment

States and Companies With No Down Payment Car Insurance

Not all states offer the option to buy no down payment car insurance; the states that do include Arizona, California, Florida, Georgia, New York, Oklahoma, and Washington, to name a few. However, the state with the most companies that offer no down payment insurance is California. The best part is that many of the top insurance companies offer the coverage as well, such as GEICO, State Farm, Progressive, and Allstate.

How Does No Down Payment Car Insurance Work?

When paying for your policy, auto insurance companies offer you 2 main options: either make a one-time payment for 3-month, 6-month, or 12-month coverage, or make monthly payments with no commitment. No money down auto insurance allows drivers to get new coverage without paying for several months upfront. Instead, you’ll be able to get a policy with an installment plan that requires monthly premiums.

To qualify for cheap full coverage or liability only auto insurance with no down payment, we recommend consumers compare quotes, companies and policies online to find the best rates. Like any other type of insurance, comparison shopping is the surest way to saving money.

Advantages of Car Insurance With No Down Payment

The obvious benefit of a car insurance policy that offers a low or no down payment option is that drivers do not need to pay the full premium upfront, avoiding a huge cash commitment. Instead, you will pay a small administrative processing fee and make monthly payments to continue receiving coverage for the remainder of the policy’s term.

This gives you the option to renew coverage or find another auto insurance company. The advantage is that you to get the mandatory insurance you need without a long-term commitment, meanwhile having the freedom to shop around and get cheaper rates.

Disadvantages of No Down Payment Car Insurance

While buying a no down payment car insurance policy may be the only way you can afford coverage, you should still be aware that the option is actually costing you money. When you pay your car insurance premiums upfront for 6 or 12 months, insurance companies offer you a discount. The longer the policy and premiums are locked in, the greater the discount the carrier is able to give. With no down or upfront payment, you forego this discount.

Additionally, many car insurance companies charge a monthly billing fee of around $10, which adds up to $120 annually. This money is not being spent on additional coverage, but rather on administrative fees.

Finally, when considering low down payment car insurance, consumers should expect to have their credit score and history checked. Most major companies will run a credit check before issuing a policy. If you have bad credit or a low score, your car insurance rates may be higher. If this happens, check with other carriers. The insurance industry is very competitive and providers are always looking for ways to get more business and customers.

No Down Payment Auto Insurance

Get Cheap Car Insurance Rates

You should always research or ask if there are any fees associated with a no or low down payment policy. In most circumstances, the company or agent wants your business bad enough where you can negotiate any fees that may be due on the policy start date. You may even be able to get the coverage you want without paying any fees at all except the first month’s premium.

When you are comparing car insurance quotes on no down payment coverage, you should always ask the following questions:

  • Is there a billing, processing or administrative fee?
  • How much would it cost to pay for a full 3, 6 or 12 months up front?
  • What discount do I get if I pay upfront?
  • Are there any ways around the fees?

Many of the best car insurance companies will usually waive the monthly fee if you allow payments to be directly debited from your checking account. In the end, the best way to find cheap car insurance with no down payment is to compare policies until you settle on the one that best meets your needs.

Auto Insurance Deductibles

Car Insurance Deductibles: How Do They Work?

A car insurance deductible is the amount of money you must pay on a claim before your auto insurance company begins to payout or cover additional damages, repairs, expenses or medical bills beyond the deductible. Generally speaking, higher auto insurance deductibles come with cheaper annual premiums since companies assume policyholders will be less likely to file smaller claims given the out-of-pocket expense. For this reason, picking the best car insurance deductible is critical to calculating your rates.

Auto Insurance Deductibles

How Do Car Insurance Deductibles Work?

If your insured car suffers $2,000 worth of damage in a covered accident and you have a $500 deductible, the car insurance company will pay $1,500 to fix your vehicle and you must pay $500. The deductible applies each time a claim is made for damage or repairs to the car under the policy. When buying auto insurance coverage, most insurers will offer you a choice between a $250, $500, and $1000 deductible.

Choosing The Right Car Insurance Deductible

While liability car insurance coverage is mandatory, collision and comprehensive coverage are not. Collision coverage protects your vehicle when you are in a car accident, paying for repairs and damages to your own property; meanwhile, comprehensive coverage covers damage to your vehicle in instances other than an auto accident, such as natural disasters. Both optional insurance coverages have car insurance deductibles and the amount of the deductible has a big impact on how affordable your car insurance rates may be.

Before buying the best car insurance for your needs, get multiple car insurance quotes and compare the auto insurance deductible on each policy to see which company is offering the best deal and coverage.

Car Insurance Deductible

What Is Collision Insurance Coverage?

Collision coverage insures against damage to a vehicle caused in an accident like a collision with another car or a stationary object. Although collision car insurance is not mandatory under state minimum insurance laws, it is usually required by banks or lenders when you buy a new car. The deductible on collision coverage is usually between $250 and $1500, but the most common deductible is $500.

What Is Comprehensive Car Insurance?

Comprehensive insurance covers damage to an insured vehicle caused by theft, vandalism, acts of nature and collisions with animals. Like collision coverage, comprehensive coverage is usually required by lenders who have a financial interest in a vehicle such as a car loan. The deductible options on comprehensive coverage are the same as those for collision coverage, with the average deductible being $500. In the case of theft, many comprehensive policies cover a rental car for up to 30 days.

Effect of Deductible on Car Insurance Rates

Since lower deductibles mean the car insurance company faces more risk of claims, payouts and reimbursements, the premiums for low deductible collision and comprehensive insurance coverage are higher. On the other hand, higher car insurance deductibles are priced with cheaper monthly premiums.

The catch is that the policyholder must have enough money to cover the amount of the deductible should the car be damaged. While a $1500 deductible gets you cheaper car insurance, some policyholders may not be able to pay $1500 out of pocket for repairs if their car was damaged or involved in an accident.

A Deductible Savings Account

The safest way to choose a high deductible is to put enough money in a savings account to cover the deductible if the car is damaged. By doing so, you will enjoy lower premiums and collect interest on your savings. The bank account means you will always have the money to cover repairs if your car is damaged. For those who cannot afford to bank the full amount of the deductible, opening a savings account and making regular deposits can help reduce the risk.

Get The Cheapest Car Insurance

Everyone wants to save money on car insurance, but before raising your deductible to save money with a cheaper policy, consumers should compare auto insurance companies to find the lowest rates on a policy with the deductible they need.