Are you currently shopping around for car insurance for the very first time? You likely have questions about all of the options you have to pick from. Here are some common questions you're likely to have about car insurance.
What Factors Influence Your Monthly Premium?
There are many factors that determine how much you pay for your monthly premium, with the type of insurance you purchase playing a big factor. However, two people insuring the same car can receive different quotes from the same insurance company.
Car insurance providers will factor in your age since an inexperienced driver is more likely to get into an accident. Your driving history also plays a big role, since someone that has been in an accident in the past is likely to get into an accident again. There are also statistics that insurance companies use, such as how insurance for someone that's one gender can be more expensive due to them getting into more accidents. Your credit score can even play a factor because someone that is not good with finances can be considered a higher risk.
What Is Gap Insurance?
Gap insurance is definitely something you should consider if you are buying a new car. That is because a new car loses a lot of its value the moment that you drive it out of the dealership, which can result in you having a loan that is worth more than the value of your vehicle.
Your insurance provider is only going to cover the amount that your vehicle is worth in a total loss scenario, rather than what you paid for it. However, gap insurance fills in the difference and can help pay off your loan so that you are not paying off a loan for a vehicle you do not have anymore.
What Happens If You Get Into An Accident With Someone Else's Vehicle?
Your car insurance plays a small role if you were to get into an accident while driving someone else's personal vehicle. The owner's car insurance would be what is used to pay for the damages, but your auto insurance may kick in if there are shortcomings in the other insurance policy. For example, it may be possible to use your own liability insurance in an accident you cause if the other driver has high medical bills.
Reach out to a car insurance provider if you have more questions.