Do you know how your insurance company -- or any insurance
company -- prices the cost of your collision and/or comprehensive coverage?
It actually depends on several
factors -- including the car’s original cost, the cost to repair it, its overall safety record, and the likelihood of it being
stolen. This means that the best time to
think about auto insurance is before you buy the car. You can often get a nice
discount from insurers if the car
you're buying has a great safety record or if it's designed to reduce the risk
of theft. How do you determine these factors? You can go to the website of
the Insurance Institute for Highway safety (iihs.org) and find information as to which cars offer the greatest safety and/or the lowest risk of
Second, be sure to reduce your collision coverage as your car grows older. For that matter,
if you car is worth less than 10 times the premium,
you may not want to purchase collision coverage,
as it just may not be worth it. How do you find out what your car is worth? Your bank’s auto loan department or just about any car dealership can tell you. You can also look it up online at the
Kelley’s Blue Book website (www.kbb.com).