Its illegal to drive without insurance in the United States, driving with insufficient insurance is also illegal, and the penalties are quite high. You could have your license and registration suspended, fined a worthy amount, and you will still be liable to get arrested. Used car is almost identical to auto insurance for a new car; however there are some noteworthy differences, on how the premium is calculated, and how you decide what coverage you would be requiring.
Steps in shopping for auto insurance for a used car are almost the same as for a new car; you get multiple quotes, (5 to 6) and then compare the prices, and the cover provided to you. After all the intention for both types of insurance is the same, to protect the owner from losses in the event of accidental damage. The trick is to select a quote which offers you a respectable extent of cover at a reasonable price, it does take some work, but it is possible to find such a deal.
Used vehicles generally attract lower premiums, this holds true for collision and comprehensive insurance. This is firstly due to depreciation, and secondly due to the fact that it costs less to repair a slightly older car, than a new state of the art model. Depreciation affects the overall value of your car, which means that if it is stolen or totaled the amount the insurance company would have to pay you would be much less compared to if it was a new car.
Repairing an older car is generally much cheaper as the cost of spares drop over the years. Older cars are also not the priority for most car thieves. When it comes to liability insurance, the age of the car and depreciation don’t affect your premium, and old car and a new car can cause the same amount of damage to another vehicle, or a pedestrian during an accident; thus the premium for liability insurance for an old and new car isn’t much different.
Many people don’t take collision cover and/or comprehensive cover in order to save on their premiums, and this can be beneficial if you have a very old car. If such is the case, you will spend more money on insurance premiums than on repairs on the car, should you have to pay for them yourself. You can also evaluate your coverage on collision and comprehensive insurance, if it is too low, and not worth the value of your current car, its best you appraise it, and if it’s higher than the current value of your car, drop it to the state minimum, or somewhere in between where you are and the minimum.
You can increase your deductibles too, by which you drop your insurance premiums by quite a bit, and pay a certain part of the cost to repair the total damages out of your pocket. This is recommended only if you are a safe driver and have a clear accident history, or else you will end up spending far more than you save. It’s as simple as you save some money now at the risk of spending more later – this is where you need to balance cost against risk.
For this reason it is very important to understand your car, its current financial value, and decide if it is worth spending a bomb insuring it, or insuring it for the minimum and paying for repairs and damages at a later date.
