St. Louis, Mo., August 10, 2010 – Fender benders and other vehicle mishaps result in billions of dollars in property damage, medical and legal bills as well as lost income for motorists every year. The right insurance policy can protect consumers from serious financial losses – and keep them in compliance with laws in states that require motorists to carry insurance.
The Better Business Bureau (BBB) advises consumers to make sure they understand the coverage they’re buying so they avoid buying coverage they don’t need – or fail to purchase coverage that will protect them in case of a serious accident. Consumer complaints about coverage often concern delays in handling claims or misunderstandings about billing, so it pays to read policies carefully and check to see if others have filed complaints with the BBB.
“Insurance can be a confusing topic, but the BBB has tips that can de-mystify buying coverage,” said Michelle L. Corey, president and CEO of the St. Louis BBB. “By boning up on the basic terms and shopping with at least three different companies, consumers can feel secure in their decisions about which insurance to buy.”
The basic types of coverage include:
- Bodily Injury Liability. Pays your legal defense costs and claims against you if your car injures or kills someone. Covers family members living with you and others driving with your permission.
- Property Damage Liability. Pays your legal defense costs and claims against you if your car damages another's property. Does not cover your property, including your auto.
- Medical Payments or Personal Injury Protection. Pays medical expenses resulting from an accident for you and others riding in your car. Also pays for you or your family members injured while riding in another's car or while walking.
- Collision. Pays for repairs of damage to your car caused by a collision with another vehicle or any other object, regardless of who was responsible.
- Comprehensive Physical Damage. Pays for damages to your car resulting from theft, fire, hail, vandalism, or a variety of other causes.
- Uninsured or Underinsured Motorist. Pays for costs related to injuries or property damage to you or your family members and guests in your car caused by an uninsured, underinsured, or hit-and-run driver.
Consumers can save money on their policies by comparison shopping and by buying insurance that matches the type of vehicle they own, their driving habits and their financial situation. Some ways to save include:
- Ask for Higher Deductibles. Deductibles represent the amount of money you pay before your insurance company fulfills a claim. By requesting higher deductibles on collision and comprehensive (fire and theft) coverage, you can lower your insurance costs substantially.
- Drop Comprehensive and/or Collision Coverage on Old Cars. It may not be cost effective to have collision or comprehensive coverage on cars worth less than $1,000 because any claim you make would not substantially exceed annual cost and deductible amounts.
- Buy a "Low Profile, Low Maintenance" Car. Cars that are expensive to repair, or that are favorite targets for thieves, have much higher insurance costs.
- Low Mileage Discounts. Some companies offer discounts to motorists who drive fewer than a predetermined number of miles a year.
- Automatic Seat Belt and/or Airbag Discounts. Some coverages provide discounts if you have automatic seat belts and/or airbags.
- Anti-Lock Brakes. Anti-lock brakes improve steering control and stability when a car is brought to a stop, thus reducing accidents. Some states require insurers to give discounts for cars equipped with anti-lock brakes while some insurers have a nationwide discount in place.
Ask the insurance company about other discounts you or your family may qualify for, such as discounts for good students, accident-free drivers, driver training courses or having more than one car insured with the company.
Before you buy, check with the BBB for a Reliability Report on a company by going to
www.bbb.org or by calling 314-645-3300.
Contacts: Michelle Corey, President & CEO, 314-645-3300,
mcorey@stlouisbbb.org, or Chris Thetford, Director of Communications, 314-645-3300,
communications@stlouisbbb.org