3 Mistakes People Make When Getting Car Insurance

Written By Jeff Hindenach
Last updated December 11, 2020

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November 5, 2015

Simple. Thrifty. Living.

Buying car insurance isn’t fun, but if you’re going to drive legally, you need it. The process of buying car insurance isn’t straightforward because there’s no “one size fits all” policy. You need to be aware of the hidden traps in the car insurance process so you can avoid pitfalls and ensure you have the best insurance for your circumstances.

Car insurance isn’t a place to skimp if you’re trying to save money in your budget. Most states require a certain level of insurance, and many cost-conscious individuals just acquire the minimum to ensure they can continue to drive. However, these bare minimum amounts only provide bare minimum protection. While you should try to avoid overpaying, you need to buy enough coverage to protect your savings in the case of an accident. Remember, the less you pay now, the more you will probably pay if you get into an accident. Instead of focusing purely on the price tag, focus on your personal circumstances.

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You might think that insuring a car is a straightforward process with little variation in terms of coverage, but insuring a Ferrari is not the same as insuring a family’s minivan. If you routinely drive cross-country, you might need a different type of coverage than if you just drive around town. When acquiring insurance, you need to consider everything about your driving circumstances. Where you live, your driving habits and routine, and how much you can afford heavily influence your coverage. Before consulting with an insurance company, think through those issues to ensure you get the coverage you need.

Surprisingly, some people don’t get several quotes before settling on a car insurance provider. Insurance is a significant recurring monthly expense, yet some go with the first company that makes a quote they can afford. It is absolutely vital that you check out several companies before making a decision. Not only could you lower your premiums, but you could get better coverage for your circumstances.

About the Author

Jeff Hindenach

Jeff Hindenach is the co-founder of Simple. Thrifty. Living. He graduated from Bowling Green State University with a Bachelor's Degree in Journalism. He has a long history of financial journalism, with a background writing for newspapers such as the San Jose Mercury News and San Francisco Examiner, as well as writing on personal finance for The Huffington Post, New York Times, Business Insider, CNBC, Newsday and The Street. He believes in giving readers the tools they need to get out of debt.

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