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Things to Look out for When Buying Auto Insurance

Automobile insurance is the first thing that you need to buy after owning a vehicle. Unfortunately, many people regard car insurance as a form of corporate greed and a drain on financial resources. But that’s not the case. Sure, not all of us end up in a collision, minor or significant.

4 Reasons to Buy Auto Insurance

However, if you do, at that very moment, you’ll wish that you had car insurance. Why? Well, let’s take a look at the top reasons to buy insurance.

1. Rising Repair Costs

Modern vehicles are not just steel frames on a set of wheels. Instead, they are supercomputers. Just think about Tesla and the increasing use of autonomous driving features. If you end up in a collision, repairing the frame is the last of your concerns. One must pay for the repair or replacement of numerous electric components. The costs can quickly balloon up to thousands of dollars for what seems like a minor collision.

2. Liability

If the collision is due to your fault, you are liable for the other vehicle’s damages. Similarly, you would end up paying third-party damages for personal injury, loss of income, loss of quality of life, and a lot more. Even if you are a millionaire, you’d want to avoid them at all costs.

3. Legality

Car insurance in the UAE is compulsory. Anyone caught driving without car insurance in the UAE will be fined or even jailed. The UAE is not the only country to do so as the UK, USA, and many other countries have also made car insurance mandatory. Therefore, you need to have insurance if you plan on staying on the right side of the law.

4. Protection

Cars get stolen, damaged by vandals, or even acts of God. Well, numerous other things can happen. It can catch fire and whatnot. The point is that many things can go wrong. Car insurance protects you against such acts.

For instance, if your vehicle was stolen or damaged by vandals, your insurance provider will pay for the loss. Without insurance, you are just worse off.

Now, let’s focus on the different things that you need to consider while buying auto insurance.

7 Things to Look for When Buying Auto Insurance

Kindly read the article thoroughly because the information we are about to share will surely help you.

1. Needs

The first thing you need to do while buying car insurance in the UAE or anywhere else is to conduct a needs assessment. It is a simple exercise where you determine your precise needs and what type of policy you need.

There are two types of car insurance policies – third-party and comprehensive.

In a third party, only damages to the third party are covered. You’ll be paying for your damages yourself. In comprehensive, the insurance provider is responsible for the damages incurred by you and all other parties involved. Please note that the extent of the damage cover is dependent on the policy you have selected.

How to know which policy you need? Well, that’s simple. If you drive around a lot, the chances of a collision are more significant than those who occasionally drive. Opt for a comprehensive policy if you spend a tremendous amount of time on the road. Otherwise, just for a third-party cover.

2. Reputation

The second thing to look for when buying a car insurance policy is the provider’s reputation. The best car insurance provider is the one that has the best reputation. How to judge the reputation? That’s easy. Ask friends and family. If they cannot provide any useful information, a quick Google search can reveal a lot about the company.

Check what the customers are saying about them. Unfortunately, some insurance providers have a bad habit of delaying claims. It is best to avoid such car insurance providers. Also, look at how quickly claims are settled. These are things that separate a good insurance provider from a bad one.

3. Pricing & Add-ons

Once you have catered to the first two things, now is the time to compare the prices. Insurance is a competitive business. The best car insurance companies PitstopArabia offer the best prices to attract customers. Your job is to look for such pricing. Check & compare the prices. Look into the add-ons too. A company might be offering high prices, but their add-ons are a must-have.

Likewise, one company might be offering the lowest rates. However, their add-ons are minimal. Therefore, you have to undertake a comprehensive analysis. Find the right balance between pricing and add-ons. It is the only way to ensure that you get a good deal. Otherwise, you might miss out on badly needed add-ons while going for low pricing.

4. Legal Costs

Things can get messy if you are the person at fault, or there is a disagreement about who is at fault. In such situations, the judicial system gets involved. A judge or a tribunal has to decide on the guilty party. Legal costs are not manageable on the budget. Therefore, look for a car insurance provider that offers legal cover or at least anything close to it.

5. Garages

After a collision, the next step is getting the vehicle repaired. Well, yes! Repairs by inexperienced workers can do more harm than good. Therefore, ask the company about which garages and repair shops they offer as a part of the policy. Naturally, a higher number of reputable garages is a good thing. You can get the vehicle repaired from a reputable workshop close to your house.

6. Discounts

Another thing that you must look out for is discounts. Many car insurance services offer discounts. If you have not claimed in the previous year, you are entitled to a ‘No Claims’ discount. Similarly, individual professionals like the police and armed forces are also given discounts in countries like the UK and the UAE.

Lastly, it would be best if you asked for a discount during the negotiation. Insurance is a competitive business. Insurance providers give away discounts in the hopes of roping in a customer.

Wrap It Up

This concludes our article. We are hopeful that you found the above information interesting and meaningful. If you feel that we have left out any important points, please let us know in the comments section.

Ajeet Sharma, the founder of Financegab and a well-known name in the field of financial blogging. Blogging since 2017, he has the expertise and excellent knowledge about personal finance. Financegab is all about personal finance which aims to create awareness among people about personal finance and help them to make smart, well-informed financial decisions.


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