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Shopping for Auto Insurance

If you're not in the habit of requesting quotes from auto insurers at least once a year when your policy is set to renew, you could be missing out on big savings. Just like most other goods and services in the marketplace, insurance premiums are consistently rising, too. That may mean you're not getting the best deal. But, before you start calling around or getting online quotes, be sure you understand exactly how auto insurance works.

Types of coverage. If you have a vehicle registered in North Carolina, you are required to carry liability insurance, which provides protection from claims arising from injuries or damage to other people or property. But you may need or want more coverage. Collision insurance covers your vehicle for repair or replacement if you collide with another vehicle, regardless of whose is at fault. Comprehensive insurance safeguards against damage to your vehicle due to theft, fire and flood.

How price is determined. As price may be a deciding factor for your policy, it is important to know how prices of policies are determined. Driving history and experience, type of car, the area in which you live, how far you drive to work and deductibles are all factors in the pricing of your policy. If the price seems high, it doesn't mean you should cut important areas of the policy to reduce overall cost. The last thing you want is to be underinsured. It's not only unsafe, but could jeopardize your entire financial future if you are held responsible in an accident and your policy does not have enough coverage. If cutting costs is important, consider bundling insurance products with a single carrier for reduced rates.

Understanding deductibles. A deductible is the portion of the insurance claim not covered by the provider. The price of the policy is partially determined by the amount of your deductible. The higher your deductible, the lower your policy price will be. This is due to less risk taken on by the insurance provider.

Call your Credit Union. Remember, as a local government employee you benefit from being able to use Local Government Federal Credit Union for your auto insurance needs. For more information or to obtain a risk-free quote, call LGFCU Insurance Services at 888.856.2350.