We continue with Part Two of our post, Advertised Insurance Features.
New Car Replacement
A new car is a big investment; it makes sense that you would want to do everything you can to protect it. New vehicles rapidly depreciate in value, meaning the insurance company is unlikely to provide enough money to replace your new car if you total it. That is why many insurance companies promote New Car Replacement coverage that promises to replace an insured vehicle with another one of the same make, model and year.
Liberty Mutual is well-known for its New Car Replacement program. However, many different companies offer similar coverage, with some extending the protection for several years. Whether you drive a used vehicle or a new one, we here at Stauffer-Klug Insurance can help you find replacement coverage that meets your needs.
When you see commercials for State Farm’s Discount Double-Check, you are really seeing an advertisement for a service that can be offered by an insurance agent representing any company – not just State Farm. Essentially, State Farm is saying that its agents will do their job to search for all the discounts you may qualify for from State Farm. If you use an independent agent instead, your agent can search and compare discounts from multiple insurers in an effort to maximize your savings.
GAP Insurance is the next major feature offered by insurance companies, although it is not as frequently advertised as other benefits. This coverage is designed to pay off the balance of your car loan when a collision insurance settlement is not enough to pay the debt. Since most car loan balances take many months or years to fall even with vehicle valuation, GAP coverage has the potential to save you thousands if you total your vehicle.
You can get this coverage from most car insurers, but it is also available from alternative sources like your car dealer or lender. Given the nature of this coverage, however, we recommend using an independent agent to shop for GAP protection instead. That way, you can drop the coverage and save money on premiums when the balance of your loan no longer exceeds the value of your car. With lender or dealer-sold coverage, the premiums are often paid upfront for the duration of the entire loan.
Last, but not least, we turn the spotlight on the famous Accident Forgiveness feature advertised by Allstate. This optional coverage promises to protect you against rate increases after a first-time accident. Considering average premiums can soar after an accident (even for the safest drivers), Accident Forgiveness can seem quite appealing to cost-conscious drivers.
Allstate does charge extra for Accident Forgiveness, and it typically comes with additional eligibility requirements. Comparatively, you could shop around for the same type of protection from other companies, such as Progressive, Acuity, Nationwide, The Hartford, Liberty Mutual, and Integrity, the latter of which offers a form of accident forgiveness to certain long-term policy-holders at no additional cost.
Ultimately, it pays to keep your independent agent close when exploring the various features being advertised by insurance companies. There’s always going to be some benefit that is new or new-to-you, but that does not always mean it is best for you.