Why you may no longer have adequate insurance coverage. And why you should always check and keep your car receipts.
DALLAS – Good news! Since I reminded you just back in August to make sure you have adequate home insurance coverage, I’m definitely not going to repeat that you REALLY NEED TO MAKE SURE YOUR HOME IS NOT UNDERINSURED. Instead, let’s talk about how what you drive might be underinsured.
Vehicles cost a lot more… so does their repair
Prices for new and used cars have risen to record highs this year. Keep that in mind the next time you drive. If you zoom in close by, your car, the truck right in front of you, and the SUV in the lane right next to you may be worth a lot more.
As Bankrate pointed out earlier this year, if you crash into one or both of those cars next to you, it can cost your insurance company a lot more than it did a year or two ago to repair or replace all of those vehicles.
Additionally, Bankrate notes that medical costs have increased by 5.1% since last year. So if your accident involves an injury, coverage can now also become more expensive.
Your premium may have gone up… maybe a lot… but did your coverage fit?
You may be one of many Texans who have noticed that your auto insurance premium has gone up…perhaps quite a bit. S&P Global Market Intelligence tracks this monthly. These are the increases they only noticed in July, but they report increases in insurance rates every month.
In 2022, the website listed numerous auto insurance rate increases imposed by many different insurers in Texas, ranging from 4 percent to 15 percent.
But what about your reporting? did it work out Are the inflation-related additional costs adequately insured? This is really something you should talk to your insurer about, especially if you haven’t adjusted your coverage in the last year or so.
Add coverage and search for plans
Understandably, if your premium is already increasing, you may not be in the mood to increase it even further by adding extra coverage. But Bankrate makes a big point of it in its analysis.
The website checked the numbers and found that the average premium for minimum liability insurance was $21 less per month than what you would pay for high-end insurance ($135 per month for minimum liability insurance vs $156 per month). 250K/500K/100K coverage).
These numbers vary by provider, but they illustrate that adding a lot more coverage might not be as expensive as you think. Money Geek explains what each of these numbers means and offers some tips on coverage amounts.
Take a look around, find out what your current coverage is, and consider how much coverage you might need. This can be an important conversation with your insurer or prospective insurer, especially with the rising cost of cars and medical care.
NerdWallet explores a few things to consider when looking for auto insurance.
On the subject of car insurance: keep receipts!
I know… Receipts can be a lot to keep up with, especially in an increasingly digital world. But stick to those slips of paper for car-related stuff.
I have a friend who just went a really long way with his insurer. I say he walked down this street because he couldn’t drive his truck, which had been waiting in the shop for months for accident repairs. After all the waiting, the insurance company decided to total the vehicle.
But the odometer was damaged, so they offered him a lot less money, thinking his truck had a lot more miles on it than it actually had. To make his point, my friend turned to his most recent oil change receipt to prove his mileage wasn’t that high.
But it had an incorrect digit (think 112,734 miles instead of 12,734 miles). Eventually he was able to prove his correct mileage and receive a prorated payout from his insurer, but it was a hassle on top of an already long, frustrating experience.
I went through something similar years ago when trying to claim the tread warranty on tires that wore out way too quickly. I hadn’t noticed before that on the original receipt when they put the tires on they had put my mileage at around 6,000 miles when in fact the car had around 60,000 miles.
So, at 70,000 miles, my new tires were still very new with only 10,000 miles on them…unless you took into account that the receipt said they were fitted at 6,000 miles, in which case it was looked like they had been driven 64,000 miles. A big difference.
I was able to verify the correct number with an auto inspection around the same time my actual mileage was measured around the time the tires were fitted, closer to that 60,000 mile figure.
So keep those receipts. And sure enough, look at them at the point of sale to make sure the date and mileage are correct!