The Truth about Cheap Auto Insurance


Many people look for cheap auto insurance these days, and no wonder, there are countless of “cheap” insurance company everywhere.  Their sheer number and advertisements in radio, TV, and on the Internet can help you find one in no time.

However, this leads us to another question. If such company exists, why there are so many of them, when people could just easily switch to that particular company and all the rest would fail. In this article, we’re going to talk about what a cheap insurance coverage is and why some people have stayed away from them.

Insurance is all about determining your risk using predefined factors such as your car, age, occupation, location, income or credit. Insurers have known to use them all the time, just like your creditors or lenders using your credit scores to determine your financial capacity. Though they differ from many aspects, but the analogy remains the same. Lenders assess the risks and insurers the probability of an accident. This is the reason why you should be doing comparison-shopping if you want to save money on auto insurance because no two companies are the same.

However, those who are looking for ways to save a few hundred dollars will end up buying cheap car insurance coverage. Keep in mind that there’s no magic behind this coverage and the insurers are able to offer such prices after adjusting a number of variables.

The Coverage – Obviously, you can’t compare comprehensive and cheap insurance in terms of coverage. It’s like comparing apples to oranges. The quality and coverage of the service will have a major disparity.

We already know that each state has its own minimum liability requirements. Cheap insurance coverage uses this default requirement as its barebones, no more, no less. In fact, some insurers are offering their cheap policies that do not even meet the minimum requirements of the state. If you must use cheap insurance coverage, just make sure that at least, the limits are met according to your state’s requirements, otherwise, you could face serious charges in the future.

Customer Service – The way these companies will serve their clients is incomparable to that of traditional companies that can afford to hire personnel. Limited people mean longer waiting time to answer your calls, or emails and may not have any online support at all. Customer support is extremely important in case you need to know something right away or when filing a claim.

Filing a Claim – Cheaper insurance companies tend to delay processing of your claim. The queue is usually long, and you have to wait for your turn. On the other hand, people who are using the traditional insurers could file their claims right away without having to wait for a week or months. They are able allocate people to look at your account and assist you instantly. 

Some companies even provide you with rental service to keep you mobile and not having you waiting without a vehicle, while your car is being fixed. Claim issues are very common with cheap car insurance companies as well.