A lot of people are choosing to buy second hand vehicles instead of buying brand new ones. Because of this, it resulted to a higher rate of people getting used car insurance. This kind of insurance policy does not really differ a lot from the regular kind of auto insurance policies. The whole point is still the same. Insurance is an assurance of coverage against times when accidents might happen.
However, used car insurance premiums have prices that are a whole lot cheaper than their brand new counterparts. Insurance providers assume that any damage done to a previously owned car is cheaper. It thus results to cheaper premiums. However, this is true only for personal injury and collision coverage, and these are not mandated by any laws, but they do keep your peace of mind. Liability coverage garners the same rate because the damage done to another party is not affected by age of the car or vehicle.
Someone who wants to own used car insurance should check his or her deductibles. This value is actually set by a policy holder and it can affect premium rates. If you set a higher deductible, you will be given a cheaper premium rate. In this case, a deductible is a certain amount that an owner of the vehicle chooses to pay. This value reduces the total cost of damages whenever claims are made. The amount left will be covered by an insurance provider. For new vehicles higher deductibles are advised. People with used cars, however, would rather spend more for actual damages than make savings. It is a matter of seeing the opportunity cost.
Like ordinary car insurance, used car insurance also considers the driving records of a policy holder as a determinant for premium rates. Just like ordinary policies, higher rates are asked from high risk drivers. For a refresher, the qualifications are:
Age – new or young drivers and those elderly ones
Driving Records – abundance of violations and tickets
Mileage –distance driven regularly
Residence –claims history of the area where you reside
In addition, the make and model of your car is also a factor. A higher end car with a lot of advanced features (for example race cars) will have a higher premium. Insurers argue that these kinds of cars are more prone to damages because they are driven at higher speeds. In addition, these cars are more attractive to criminals. When getting your own second hand car, choose one that works for you, moreover, safety features will always be welcome.