When your car gets to be older, its value will start to decline. You can check with your insurance agent or online resources, such as the Kelley Blue Book, to estimate the current value of your car. You may check the value of their car, and learn that after 14 years of ownership, it is only worth $900. This car may have been paid off for five years, yet there is still a lot of insurance coverage on the car. The annual insurance payments are $1000. In this scenario, you can see if you’ll save by reducing coverage on the car, since the annual payments exceed the actual value of the car. Call the experts at UNO Insurance in Phoenix, Arizona today to learn why you may want to reduce coverage on your older car.
Comprehensive versus Liability Insurance
In Arizona, the state only requires you to purchase and show proof of liability auto insurance. You can also opt to show evidence of financial responsibility through purchasing a $40,000 Certificate of Deposit made out to the Arizona State Treasurer. Most people get additional coverage beyond the minimum requirements when they buy a new car. They do this because having only liability insurance will not pay for the car if it is damaged or stolen, for example. Purchasing comprehensive coverage as well as liability insurance will get you this added security. However, if the car is older, its value is usually pretty low. In this case, you can ask your agent about removing or lowering the comprehensive coverage to save on costs. You may also consider adjusting your deductible or coverage limits to save.
Why you Might Consider Buying an Older Car
Many parents and guardians opt to help their teen purchase a car by getting an older car. Since the teen is a new driver, they may dent or damage the car when learning to drive. It may not make sense to buy a brand new car. Many drivers buy older or used cars to save on both car insurance and payments. For example, a driver may not commute far or need a car that is brand new. You can also research whether parts for the car are cheaper to buy if you expect you’ll need maintenance on an older car. Of course, you will want to get the car inspected and make sure it is safe and reliable to drive.
What are Other Ways to Save on Auto Insurance?
Here are some other tips to save on auto insurance:
- Ask about discounts for safe driving records, going to college, and other programs;
- Bundle your auto insurance with your home or renters insurance to see if the company will give you a discount, or;
- Make quarterly or bi-annual payments, which can be an incentive for your insurer to lower fees.
UNO Insurance agency can help you find out more about how to research auto insurance rates for your older car and save in our Phoenix, AZ Offices. We welcome you to call us today!