Auto Insurance 101 in Ann Arbor, MI

Auto Insurance 101

When you need help discovering an insurance coverage policy right for you, you can depend on Subaru of Ann Arbor to help break down each coverage option and understand the coverage terminology. Our team will work with you so you can find insurance coverage you can feel confident about.

What Out-of-Pocket Expenses Does Insurance Create

There are many things you should consider when determining the cost of insurance, but the two major factors that are essential to remember are deductibles and premiums. A deductible is the amount of money that you pay out-of-pocket before your insurance is activated. You should also consider that if you have a higher deductible, your premium will be lower, which means you’ll have to pay more out of pocket when a claim is filed. The premium is calculated by determining your location, vehicle, and driving history.

Types of Auto Insurance Coverage

Many drivers have at least one of four auto insurance coverage plans. Those policies include:

1. Collision Coverage – If your vehicle sustains damage during a collision, this coverage will cover the cost, no matter who is at fault.
2. Uninsured/Underinsured Motorist (UM/UIM) Coverage – If you are in a collision with a motorist who is either uninsured or underinsured, this coverage will help with the financial burden.
3. Comprehensive Coverage – Damages caused by theft, vandalism, or natural disasters will be covered under this policy.
4. Liability Coverage – If you are deemed at fault during an accident, then this policy will help with expenses. It’s important to note that this coverage plan has two components – bodily injury liability and property damage liability; however, this policy does not cover damages to your vehicle or bodily injuries.

When deciding which coverage to choose, you must ensure you fully understand all the terminology. You should also know that when you file a claim through your insurance, you will have to submit a formal request.

When submitting a claim, it must be done through the policyholder, so whoever possesses the insurance policy, whether you or a family member.

Reading and understanding the entirety of the policy will help you understand any policy exclusion, like scenarios or conditions that you are not covered.

Tips and Tricks for Finding the Right Coverage

1. Bundle Your Policies – If you have auto and home insurance through the same company, you can bundle the policies and save money or potentially qualify for discounts.
2. Maintain A Clean Driving Record – You can reduce your insurance rates and save money on your premium with a clean driving record. Try avoiding traffic violations or consider participating in a defensive driving program.
3. Understand Your Needs – You don’t want to pay for coverage you don’t need; for example, if you have a vehicle, you don’t drive anymore, you may not need full coverage.
4. Choose The Right Deductible – Understanding the pros and cons of each deductible is essential for determining which plan meets your needs and saves you money.
5. Know Your Car's Value – You can decide on a policy and save money when you better understand your vehicle's depreciation rate and current value.
6. Inquire About Loyalty Perks – If you’ve been with an insurance provider for an extended period, you may qualify for perks. Make sure to ask your provider so you can save money.
7. Review Your Policy Regularly – You may experience a life change, whether moving to a new location or purchasing a new vehicle, so reviewing your policy to ensure it still meets your needs is essential.
8. Avoid Making Small Claims – Frequent small claims can increase your premium, so it may be worth paying for minor damages yourself.
9. Ask About Discounts – Each provider is different, so don’t hesitate to ask about discounts you may qualify for.
10. Shop Around – You can save money by getting quotes from several insurance providers. You can compare the quotes and decide which provider works best for you.

Finding auto insurance coverage doesn’t have to be daunting. Our team at Subaru of Ann Arbor is here to help you every step of the way, and we want to ensure you get the insurance that meets your needs.