For anyone who drives, car insurance is a necessary—and sometimes hefty—expense, so the last thing you want to do is to increase the cost of your coverage. Even if you are a perfect driver, there are still ways to mess up your car insurance rates. But we can help!
Here is a comprehensive list of decisions to avoid making in order to stay on your car insurance provider’s good side.
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1. Having a Bad Credit Score: How can you be trusted to make insurance payments on time if you cannot make credit card payments on time? This is the exact question that your insurance provider will ask upon viewing your credit score. So don’t let your score fall through the cracks.
2. Letting your Car Insurance Lapse: Though it can be tempting during periods of time where you don’t drive often, do not cancel your car insurance. If you do cancel your car insurance and then reup it a few months later, your insurance provider will view you as a high risk driver insurance and increase your rates. This is because such inconsistent behaviour is like having a bad credit score and it doesn’t paint you as a reliable person.
3. Withholding Information About New Drivers: Whether you have a newly licensed teen in your household or a new live-in partner who has started driving your car regularly, your insurance company needs to know about them. If someone is not listed as a driver on your car insurance, and they get in an accident, you are liable. Don’t let your insurance provider find out about new drivers the wrong way.
4. Letting Someone Take Your Car to Move to a New State: Different states have different registration criteria. And the further that your car goes from your home, the more risks that arise. Your insurance company needs to know about such risks. It’s better to either not let someone take your car or to inform your insurance provider that you are letting someone use your vehicle to move out of state.
5. Financing and Insuring a Car for Someone Out of State: As previously mentioned, different states have different protocols for car insurance. It can get vastly complicated to try and insure a car across state borders, so it’s best to just avoid the situation altogether.
6. Lending Your Car for Extended Periods of Time: You will be liable if something goes wrong while your car is lent to another person. Instead of lending the car and hoping your insurance provider never finds out, see about adding the person you wish to lend your car to as a driver or inquiring as to whether the person can insure themselves on your vehicle. Though providers in different states will have different rules, your insurance provider can at least offer guidance in such a scenario.
7. Carrying Insurance Even After Selling Your Vehicle: Once you sell your vehicle, the new owner needs to get their own insurance. They cannot make payments to you so that you keep paying the insurance provider.
Besides, you do not want to be liable for another driver. If that driver is your child, then there are ways that you can remain attached to the insurance even after the ownership change. But you need to notify your insurance provider about such changes.
8. Making Commercial Deliveries in a Personal Vehicle: The more you drive, the more your risk increases. If you are using your car to be an Uber driver or a pizza delivery driver, you should insure your car as a commercial vehicle since it is being used for commercial purposes. This will guarantee you a better rate than if you just increase the amount of driving on your personal car.
9. Not Telling Your Insurance Provider about a New Car: After purchasing a new car, you have between 14 and 30 days to notify your insurance company about your new vehicle. If you miss your insurance company’s deadline, you may be penalized.
10. Letting an Excluded Driver Drive your Vehicle: If you have named someone as an excluded driver on your car insurance, they cannot, under any circumstance, be driving your car. This is because this person is not covered at all in your policy. If you happen to change your mind about an excluded driver, then change their status before allowing them to drive your vehicle.
Avoiding these mistakes will go a long way in ensuring that you have the best car insurance rates possible, not to mention securing your own peace of mind.
Margaret Huntley Margaret Huntley is a creative writing and philosophy student at Western University. She has been working as a freelance writer for over two years and has written about everything from insurance, to poker, to health and wellness for international businesses.