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Getting Car Insurance for a Newly Financed Vehicle

by nate

Buying a new car is an exciting event in your life. At the same time, there are plenty of things that you need to take care of before you can settle back into life with your new vehicle. Consider the following when you are looking at such a purchase so that you can avoid problems. Remember, financed vehicles need special coverage. This is mandated by the lender that loaned you the money for the vehicle that you purchased. Make sure that you are well versed with the following information so that you can make educated decisions regarding your insurance policy all while meeting the requirements of the company. 

What is Full Coverage?

When your lender says that you have to maintain full coverage on your vehicle while they hold the lien on it, they mean that you have to have three main things on your insurance policy. These three things include collision, which is coverage for your vehicle if you are in an accident, comprehensive, which is coverage for the unexpected things that might happen when you are not driving your car, and liability, which covers other people’s things if you are found to be at fault in a car accident. Liability is generally considered state minimums and is required by law, but the other two are optional for vehicles that are not financed.

Levels of Full Coverage

Even though you are bound to having comprehensive and collision coverage on your vehicle if it is financed, you are not bound to have a set amount of each. There are different levels of coverage when you are talking about a car insurance policy, so you should be aware of the options before you make a decision. You can choose lower limits, but it leave you open for out of pocket costs if you exceed the amount of the insurance policy. Higher limits are more expensive, but they give you a range of freedom if you should find yourself in a bad spot.

Basics that are Included

Regardless of what insurance policy you choose, there are some things that will always be included. Generally, these things are only the state minimums for your vehicle and they can be liability coverage and personal injury protection. Not all states require that both of these be present in a policy, but they are both good to have. Still, if you want the cheapest of the cheap, you always opt for nothing more than the basics listed here. If your vehicle is financed, however, this is just another part of your policy.

Cheap Versus Expensive

While the state legal minimum is the cheapest, the highest levels and lowest deductibles on a full policy is the most expensive insurance choice. Most of the time, people choose something that is in between the cheapest and the most expensive. Something that covers your vehicle and your needs is the best route to take, no matter what that means. Keep this in mind and realize that just because you have to maintain full coverage, you don’t always have to pay the highest amount. For getting more information and news about car insurance, you can browse any site that describes free auto insurance quotes.

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