Car insurance is often the last thing people think about when they are buying a car. If you’re thinking about buying a car you may well have started out with an optimistic approach that made initial decisions, such as make, model and colour, feel a little as though you were off to see Santa Claus and what an exciting time you were going to have! However, very quickly after you identify one or two cars that you would like to consider more seriously, reality dawns and you begin to realise just how many other factors need to become involved, including car insurance.
There is obviously the cost of buying the car, although this is generally not something to which we are entirely blind when considering our dream car. However, rather than paying for a new or second hand car in full, many people instead choose to purchase their car through one of the many registered car loan agreements. These also vary tremendously in terms of the period they cover, the rate of interest, and significant terms such as being either secured or unsecured.
Compulsary Comprehensive Car Insurance With Secured Car Loans
A secured car loan will require you to make sure that your vehicle is fully insured at all times, since the car is the collateral that the loan company will use if you fail to keep up your repayments. If the car is stolen or damaged, then clearly this collateral could well be worth vastly less than the balance owing on the loan – hence the absolute need for adequate car insurance for the entire duration of the loan.
Naturally you’ll be anxious about getting your own car insurance sorted fairly soon, and depending on the make, model and features of the car you are considering, your insurance premium could vary quite dramatically. Smaller, safer cars without extra features such as turbo engines, fuel injection or enviable special features such as alloys, expensive stereo equipment and such like may well be very affordable.
However, it takes relatively little for premium to rise, and car insurance must be taken into account when considering the long term payments that a car loan will entail. Stretching yourself to the maximum with a car loan may put you in the position of discovering that your car insurance payments stretch you too far.
Named Driver Insurance Policy
Another aspect of car insurance to consider is who will be driving it, or at least who will be registered to be potentially able to drive it. Often it is the case that there is only one named driver, but in some cases there may be a spouse or children who are included. This can add quite a bit to your insurance premium so it is worth considering various options, and obtaining quotes from a variety of different insurance companies to compare options and prices.
Having a child who is learning to drive included on your insurance policy could well increase your payments by a hundred percent. If you are buying a car through a car loan and have a child who may well become old enough to learn to drive during the course of the loan term, then this is worth looking into fairly early on. In some cases it may even mean that your choice of car is affected from the outset.
Address Effecting You Car Insurance Price
Another important aspect which can affect your car insurance payments is your address. Clearly there are some areas which will be considered safe and relatively low risk by the insurance companies, and your premiums could be pleasantly low. However, there are other areas, often not far away that are listed as having a higher risk attached t them. If you are thinking of moving house at some point soon, this is another factor that you will need to consider. No one is going to suggest that you move house to a safer area simply because your car insurance premium is going to be too high, but finding out well in advance what sort of price you’re likely to see quoted is a factor which will greatly affect your choice of car early on, and save you a lot of time.
Third Party Car Insurance
To help keep your insurance down you may choose to opt for the cheaper option that simply covers third party events, fire and theft of the vehicle. However, for full and complete peace of mind you will be better off covered by a fully comprehensive policy which will ensure that, regardless of what happens to your vehicle, and whose fault it is, you will be covered.
If you have purchased the car through a car loan then your loan company may well request that you remain on a fully comprehensive policy, and will not allow anything less than this. This is a factor worth considering, and finding out well in advance can again save you time and effort.
Adjusting Your Insurance Excess
However, there are also factors than help reduce your insurance price. Choosing a high deductible excess will invariably reduce your premium, and if you are a member of a breakdown service, you might also get a lower quote. Your age is significant, since younger drivers are generally regarded as a higher risk, and so pay more. If you have taken an advanced or defensive driving course you should also be offer a lower car insurance quote.
Car insurance can often be considered a necessary evil, but should the worst happen, you’ll be extremely glad of it. With so many choices and options available, and with varying prices on offer, it is highly advisable that you spend time shopping around to make sure that you benefit from the best deal. Remember, though, that the best deal may not always be the same thing as the cheapest deal.
