Purchasing car insurance for the first time.
There are many reasons to research the purchase of insurance for the first time…among the most important to probably everyone would be the cost of the insurance. THEN ALONG CAME COMPUTERS…AND NOT ONLY IS COST IMPORTANT… BUT KNOWING WHY INSURANCE RATES ARE HIGHER IN SOME AREAS AND LOWER IN OTHERS IS JUST AS IMPORTANT AS THE INSURANCE ITSELF! For example: as a teenager you are guaranteed to pay a steep insurance premium….no matter what state you live in.
You can thank the teenagers that came before you for that!…then add that to the fact that you may live in a metropolis; where there are more people and where it is more likely to be involved in an accident… you now have part of the formula for very expensive insurance high rise “Buildings”! Back in the day insurance was not mandatory, but accident claims, responsibility, law suits, loss of life, drinking and driving, madd mothers, etc. etc. all played a role in Congress enacting laws that would inevitably make having insurance mandatory.
Young people have not considered the insurance factor when they go in to purchase a car…they have not considered what the actual cost of owning a car will cost. That can be seen mirror in the light when a car is purchase and later on the insurance is dropped. If all of the other expenses were calculated in one would seriously consider purchasing a used car with only one payment….the price of the Car! Then you could get away with purchasing the minimum car insurance called Liability insurance. This is the bare minimum because it covers only the persons car that was hit by your car…basically you have coverage, but not for the repair of your car.
We older people have a slightly different dilemma to contend with…if the above mentioned teenager happens to be your child then you can carry them on your insurance…this would be cost effective for them because then you bare the responsibility for their driving habits or lack thereof.It’s a move I would not condone….unless of course you have lots of money and you own your own insurance company. Another factor that should be considered when purchasing insurance for the first time….is whether you live in a rural area or not. The reason for that question is rates are cheaper if you have a rural address. Understand that people who live outside the city are less likely to be involved in an accident for obvious reasons…less traffic.
Nearly everyone in this country has a computer or they have access to one through their local library. So, it is easier now than ever before, to acquire information about insurance companies and any other information you may desire. The World have gotten a lot smaller because of computers! That is why my next point concerning the insurance industry should be one of great interest to you! Buying insurance is really no different than buying a car from a dealer! Listen to me very carefully!…I said buying insurance is no different than buying a car from a car dealership!…Why is that?..Because…when you go to a car dealership to purchase a car, you are purchasing a car from a third party!…that means that you are going to have to pay a commission to the retailer who is selling the car!…you may ask, why is that relevant to purchasing insurance!…because the same practice is being used when you go out and buy insurance from an agent(broker)who technically is only a middle man representing a big insurance company. Shocking!..it should be!
What does that mean?…it means that if you wanted to buy the same car that the retailer has on his lot for a lot lower price…you would order that car from the whole seller…or the factory for a lot less money than you are going to pay at the dealership!….The dealers do not make the car!….he simply sells it for a commission!… I want you to think about why that is!…think about how difficult but not impossible it is for the factory to delegate that part of their business to a third party!…when you understand the answer to that!…you will understand the answer to why insurance companies delegate that part of their business to agents(Brokers)who in-turn sells you a policy based on a quote that the real insurance company have given them!…so then why would you go to an agent to get insurance?…is it cheaper?…NO!….do you have alternatives?…Yes!
These are things that you can find out for yourself with a little work…and a desire to save money.Purchasing insurance for the first time can be pleasurable if you know where to look.
Finally, this little bit of information is applicable to most all insurance agencies such as: workers compensation, life insurance companies and so on; all of these companies have what is called underwriters or in some cases Brokers….keep in mind the biggest American past time, is not just baseball, and apple pie…it’s making money!…and lots of it!…that is the goal of almost everyone in life today;
so don’t think big companies care about saving you money!…Truthfully, the only money you will save will be the money you spend wisely and smartly!