If you have spent years dreaming of owning a car that has never belonged to anyone else before and you are finally at a point in life where doing so is possible, the choices you make with your auto insurance now can have a dramatic impact on your future. Although the majority of responsible adults in the United States today are likely to be aware of how important car insurance is, you could make small policy mistakes that could cause big problems in the future. Common problems include not mentioning a roommate who might occasionally drive your vehicle or taking a second job delivering people or food. When you need to be sure that you have adequate insurance for your new car, you should be aware of the following information.
If You Get A New Roommate Who Will Occasionally Borrow The Car
Since few people plan to be in a car accident, asking your new roommate to drive safely when he runs to the grocery store one night is not going to actually prevent the problem from occurring. If you know that simply asking him not to ever borrow the car would make your living arrangements awkward for the future, it is best to mention that he will have intermittent driving privileges to your insurance agent. While damage incurred after loaning your car to someone you trust is often covered by a typical policy, you may find that failing to list someone who lives with you on your policy limits the requirements of the insurance company to pay a claim on their behalf.
You may find that you have to pay for him to be on the policy or that simply mentioning his occasional use of the car means he is covered if someone were to dent your bumper in the grocery store's parking lot. Regardless, if you never mention your roomie to the insurance company and the vehicle was damaged while in his use, you could find that the insurance company would not pay anything towards the expenses.
Using The Vehicle For Commercial Or Delivery Purposes
If you plan to take on a second job to help pay for your new car, you are not alone. In 2012, the Bureau of Labor Statistics determined that almost 5% of Americans had more than one job. If you plan to drive your new car as part of that extra employment, you are also in good company. Uber, the popular ride-sharing service, was in 400 cities as of February 2016 and it was reported in December of 2014 that an average of 50,000 drivers joined the company each month. Alternatively, food delivery jobs are also readily available in many areas.
However, this is another situation that could become problematic in the event of an accident. When you get or update a policy, it is crucial to inform your insurance agent that you are or will be starting a job using your vehicle. In some instances, you will need to add on a form of commercial insurance to cover yourself against the extra risk your vehicle will be under. Otherwise, you could be out of your second job and out of a car, but in a lot of new debt, when your car is wrecked and the insurance company does not have to pay for the costs.
In conclusion, complying with the state's minimum standard or even your lender's required amount of insurance may not be enough to protect you financially if something were to happen to your new car. Fortunately, by applying the above information, you can make the necessary insurance modifications to limit your financial liability in the event of theft, loss or damage to your vehicle. Visit a site like http://www.unitedsecurityagency.com to get the coverage you need.