Auto insurance may seem complex, but there are some essential rules that apply to almost all policies. Here are the basics of what you need to know better understand your auto insurance policy:
Your deductible affects your premium.
Your deductible is the amount you’ll have to pay out-of-pocket if you file a claim. For example, let’s say your deductible is $1000 and you’re involved in an accident that causes $2000 worth of damage. This means you’ll pay $1000 and your insurance will cover the remaining $1000. Typically, a higher deductible will mean you’ll pay lower premiums since you’re taking on greater financial responsibility.
Your driving record matters.
The most straightforward way to keep your premiums low is to maintain a perfect driving record; driving safely and defensively will help keep your record clean. When determining your premium, insurers will take into account the number of accidents you’ve had, any tickets or driving infractions, the number of years you’ve been driving (and how long you’ve been insured), and the number of drivers who will be driving your car as well as their driving records. If your driving record has taken a few hits, it may be worth considering taking a defensive driving course. Not only will it help you drive safer, it can also help lower your premiums.
You can let someone else drive your car – but you’re assuming responsibility for their driving.
Provided your friend or family member has a valid driver’s license, your insurance will cover them if they drive your car. However, if they cause an accident, it will likely impact your premium just the same as if you were driving.
Third-party liability insurance is mandatory.
In order to drive, you need third-party liability insurance. Third-party liability insurance covers damages for which you’re at fault. For example, repairs to other vehicles or property you may have damaged, medical costs if you’ve injured someone, and even legal fees related to an accident you have caused. The mandatory amount of coverage in Nova Scotia is set at $500,000, but it’s recommended you increase your coverage.
Beyond these basics, a MacLeod Lorway broker can help you determine the right auto insurance for you. Talk to us today for personalized coverage and advice.