No matter how good a driver you are, there is always the risk of getting into an accident while on the road. Whether it is a head-on collision with another vehicle or simply your car sustains damages while parked, the aftermath of any accident can be stressful and pose a huge financial burden.
Although there are several precautions you can take to stay safe on the roads, one of the best is to obtain car insurance.
Generally speaking, car insurance is mandatory by law in many countries in the world. Driving without valid car insurance is illegal and can get you in serious trouble with the authorities.
However, besides providing you with legal protection, comprehensive auto insurance also provides motorists with other plentiful benefits. Keep reading to learn about the four major benefits a good car insurance policy offers drivers.
One of the greatest advantages of car insurance is that it provides you with financial protection by covering all costs and damages that may result from an accident. Whether you or your fellow passengers get injured during a crash or your vehicle sustains severe damages, you can rely on your car insurance policy to pay for all medical bills, repair costs, and other expenses that may come along.
Besides this, a good car insurance policy can also provide coverage against natural and manmade disasters such as earthquakes, hail, theft, or vandalism. But in order to get most of these benefits, you need to choose the best policy for you by consulting with expert brokers.
For instance, if you live in Canada, click here to learn about the different car insurance policies in the country and compare rates to find the right coverage.
The overall cost of auto insurance depends on several factors, one of them often being the deductible. This refers to the amount a driver must pay out of pocket before their insurance coverage kicks in and pays out their claims.
In general, choosing the right deductible amount is very important because it impacts how much you will pay for insurance and claims overall. The general rule is the higher your deductible is, the lower your premium costs will be. This, in fact, is the greatest advantage of having a deductible with your car insurance policy because it helps you reduce the amount of money the insurance company must pay when a claim occurs.
However, be careful not to go for a too-high deductible because it may defeat the entire purpose of purchasing a car insurance policy.
No claim bonus (NCB)
Another benefit a good car insurance policy can offer drivers is a no-claim bonus (NCB). This is a discount granted to insured car owners by a motor insurance company if they don’t make a single claim during the policy tenure. It serves as a reward and can help you save a lot on your premiums depending on the number of years you go without registering a claim.
In general, the insurance company will calculate your bonus by looking at how long you have been driving, your claims history, and your rating from your previous car insurer.
In case the insurance company cannot grant you a bonus, you can pay for it yourself. However, keep in mind that the cost of this protection can be higher than your claims bonus discount and won’t make your overall policy cheaper.
Customization through add-ons
Because car insurance coverage can be quite expensive, many insurance companies allow drivers to purchase add-ons. These add-ons commonly referred to as riders, offer additional coverage and better protection along with the main car insurance plan at additional costs.
Depending on your budget and car needs, there are several types of add-ons you can consider to protect yourself and reduce your premiums.
For instance, zero depreciation is one common type of add-on which shares the burden of depreciation on the vehicle’s part and allows the driver to get a higher claim amount.
Another common add-on car owners get engine protection which provides coverage for any loss or damages caused to the engine due to electrical or mechanical issues.
No matter how much experience you have as a driver, it is important that you stay safe and protected at all times while on the road. One of the best ways to achieve this is to obtain car insurance which will provide you with financial and legal protection in the case of accidents or other unfortunate events that may happen while driving. For more information, refer to our post and learn about the benefits a good car insurance policy should provide you.