Insurance is a legal requirement if you own a car, which means everyone needs to get it, and because of that Insurance companies can often be less customer friendly than your average company. In this article we’ll outline some of the ways your insurance company might be taking advantage of you, and how to avoid them.
Higher Than Average Rates
An unfortunately common practice of Insurance companies is to overcharge you on basic rates, with the assumption that you won’t actually check what you should be paying. Since there’s no maximum amount insurance companies can charge you, the only real safety for this is competition.
You can check your local insurance rates here, and if it turns out you’re paying significantly more on your insurance than the average, then your only real option is to take your business elsewhere, or at least tell your insurance company that you will if they don’t charge you the proper amount.
Sometimes Insurance companies are also known to increase or decrease payments for seemingly arbitrary reasons, if that happens then you shouldn’t just accept it, make sure you inquire as to why.
Extra Fees
One trick that Insurance companies will do to try and get more money from you is add lots of little additional extra fees that you don’t actually need, with the hope that you don’t check what they are and if you actually need them.
Some common examples are: Rental Coverage, Roadside Coverage or Towing Coverage. These are all extremely specific and in some cases not even necessary. You should go through your coverage with a fine tooth comb and when you find things that you don’t understand or need take it up with your insurer.
Not Paying Out
In theory the whole point of insurance, and the reason that it’s legally required is so that if/when accidents do occur, the damages will be covered by the insurance company, it’s a sort of safety net that you pay into in the hopes that should you end up in an incident you won’t be hit with the massive costs of fixing or replacing the car.
In practice insurance companies are notorious for trying to pay out as little as possible should an accident actually occur. If you’re ever in such a situation they’ll find any reason to reduce your coverage. If you didn’t get the insurance details of the other driver for example they’ll not fully cover you. Or having a policy of only covering 1 year of medical bills, because after that you’re considered to have had enough time to recover (which is not how medicine works).