Just like homeowners’ policies, automobile policies are not as cut and dry as many people believe them to be. As much as internet companies and direct writers like to advertise that it’s as easy as picking option ‘Cheap,’ ‘Fine,’ or ‘Expensive,’ you should fully understand what is included for coverage in your auto insurance policy. Below are some endorsements that insurance shoppers can consider adding on to their policy:
Accident Forgiveness
For a good driver, this can be the most important endorsement you ever add. It may be natural to assume being a good driver makes paying extra for this endorsement unnecessary; but actually, for a very small amount of money, you can be assured that if you get into an accident, your carrier does not change your rating tier. This does not mean your carrier may never take a general rate increase, but typically even slight rate increases do not raise your premium as much as being rated as a poor driver does. This endorsement, can cost anywhere from $45 to$ 25 per year per policy, but will stop your premium from going up about $200 per year, per point you incur in an accident.
Towing & Labor
If you do not have an AAA subscription or similar service, a towing reimbursement could help you keep more money in your pocket in the event of a accident or claim where you may already have your deductible due. Options are usually $50 or $100 in towing reimbursement.
Rental Reimbursement
If you get into an accident and are either at fault or the other party is unknown or underinsured, or uninsured this will make sure you have a vehicle to drive around while yours is being repaired. If you are under the age of 25 this coverage may not be worth it, unless you have a household member who could use the rental in exchange for borrowing their car, in the event of an accident.
Gap Coverage
This is important for those of you who have a lender on your car, or have a brand new car that’s value may depreciate faster than the principal amount left on your car loan. This coverage literally “‘fills the gap” between the market value of your car and the loan amount so that you do not have to be upside down on your loan.
Uber/ DoorDash/ InstaCart Coverage.
If you use your vehicle as part of your side hustle your policy does not have any coverage if you get into an accident unless you endorse your policy. Your premium may go up significantly, as many carrier’s are uncomfortable with this risk, but it can’t compare to what you could be on the hook for if you are caught uncovered.
While these endorsements may seem overwhelming, your insurance agent can help you navigate which are best suited for your needs and budget. Working with an independent insurance agent, rather than a do-it-yourself internet carrier, means we take the time to highlight and explain these endorsements to our clients in detail, ensuring they have the best insurance coverage customized for their needs.
So whether you’re shopping around or simply ensuring you’re covered, reach out and I would be happy to review what you have!
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