Have you been shopping around for insurance on your new hybrid vehicle? If so, you’ve probably noticed the drastic price discrepancy between different insurance providers. Why anyone would seriously consider a fifteen thousand dollar discount is beyond my comprehension, but that’s a topic for another article entirely.
Although I’m going to list ten common mistakes here, by no means is this a complete list. Feel free to add your own mistakes in the comments section, just keep it clean.
#10. Not understanding the true cost of a hybrid
Many people will be shocked at their first insurance bill for a hybrid, because they are not aware that hybrids can be more expensive than traditional gasoline-powered vehicles. A general rule of thumb is that you should expect to pay about 30 percent more in premiums than with a conventional vehicle for the same coverage. The reality, however, can be even higher for some people.
For instance, a Toyota Highlander hybrid will cost more to insure than a regular one because of the battery pack, which leaves drivers vulnerable in an accident. That added risk can translate into jacked-up premiums.
#9. Thinking you have all the time in the world to evaluate a policy
Most car owners know that they have just 30 days from the time they purchase their insurance coverage to switch policies and keep their premiums from going up. If you wait longer, your insurer can charge you as if you had shopped around for a better deal, even if you didn’t actually do so. Usually the only way to ensure you are getting the lowest price is to compare rates between at least three companies.
#8. Thinking an insurer’s discounts can’t be combined
Some people think that certain insurers won’t give them a discount if they have exposed themselves to higher risk by owning a hybrid vehicle, but that’s not always true. Companies will often offer discounts even if you’re paying more for your coverage, so long as the risk doesn’t seem out of hand.
#7. Not understanding where to shop
When you start looking for car insurance quotes, don’t limit yourself to just one or two companies underwriting policies in your state or even nationally. Make sure at least one company is writing hybrid policies in each of the areas where you might drive the car.
#6. Not asking about discounts
Don’t assume that adding comprehensive and collision coverage to your regular policy will be enough to secure a good deal on your insurance premiums. You need to ask for additional discounts as well, such as those offered for drivers with long records of safe driving, good students, or the honor roll. If you have a home-security system, ask about discounts on your premiums for that as well.
#5. Believing insurance coverage is just about price
People often assume that they are saving money by taking the first offer they get from their insurer on an annual premium. However, price isn’t the only factor that should be considered. A better policy with higher premiums might actually be a better deal in the long run, for example if it offers more extensive coverage or some other valuable perk.
#4. Not shopping around when rates go up
People who are hit with uninsured motorist fees after an accident often say they didn’t know their insurance company would raise their rates, especially if they didn’t cause the accident. People need to realize that insurers have every right to increase premiums for any reason whatsoever, so long as they give you notice. In some states, it is required by law that companies notify policyholders in writing before changing their premiums.
#3. Not realizing there’s a difference between liability and comprehensive coverage
A lot of people assume that their state’s minimum requirements for car insurance are all they need, but the bare-bones policies many states offer often won’t provide enough protection if your car is vandalized or stolen. To make sure you have adequate coverage, opt for a more complete plan with both liability and comprehensive coverage, which will protect you if your car is damaged in an accident or stolen.
#2. Assuming that low mileage discounts are always the best choice
It’s easy to assume that adding a policy to cover extremely low annual mileage with your insurer would be cheaper than buying several policies for different sections of road where you drive each day, but this is often not the case. Insurers have different standards for how low annual mileage has to be before they will offer a discount, so shop around to make sure you are getting the lowest price possible under your circumstances.
#1. Not knowing what type of car insurance is best
It can be easy to opt for liability-only coverage when you are just learning about car insurance, but it is almost always better to buy comprehensive and collision coverage, even if you have to pay more for it. Comprehensive covers the costs of any damage your car does to other people’s property or vehicles in an accident, while collision will cover repairs to your own vehicle after an accident. If you only have liability coverage, you will be required to pay for any damage that your car does to other people’s cars out of pocket, forcing you to make a decision about whether or not it is worth fixing.
What are some common mistakes with insurance for hybrid vehicles?
The most common mistake is not understanding the differences between hybrid policies. People often assume that adding comprehensive and collision coverage to their regular policy will be enough to secure a good deal on their insurance premiums. Other mistakes include not shopping around when rates go up, thinking low mileage discounts are always the best choice, and not understanding the differences between liability and comprehensive coverage.
What type of car insurance is best?
It’s always better to have comprehensive and collision coverage in addition to liability, even if you have to pay more for it. This way, if your car is ever damaged or stolen, you will be covered.
Where should I shop for car insurance?
In order to get the best possible deal on your car insurance, you should shop around as much as possible. You can compare different companies and policies by using websites like Insurance Panda.
In Light Of These Facts
We hope that you found these 10 mistakes helpful. If not, let us know in the comments below and share your thoughts!