One common mistake many people tend to make when buying their first car is failing to prepare for the other costs that come with owning a vehicle.
When you buy a car, you won’t only pay the total cost of the vehicle, regardless of whether you pay for it in full outright or take out a loan. Owning an automobile also means regularly shelling out a substantial amount of money for fuel, maintenance, repairs, and insurance.
Where Not to Cut Corners When Buying a Car
Since owning a car means taking on additional financial responsibilities, finding ways to save money will be on top of your priorities. Your first step may be to scrimp on some vehicle upkeep-related expenses.
While this strategy could be effective, make sure be careful with choosing which areas of car ownership to be frugal with. Car insurance is one item in particular where you should never consider cutting corners.
When you take enough time to compare car insurance in Dubai or wherever you reside, you will find the right one that meets your needs, preferences, and budget. You will also be protected and have peace of mind as you enjoy the perks of owning a vehicle.
If you’re still having doubts about getting auto insurance, below are five reasons that should lead you to the right path:
1. You may be required by law to get car insurance
In many countries, all drivers are legally obliged to purchase auto coverage before they are allowed to go out on the roads.
Find out if car insurance is a requirement for all drivers in your location. If it is, purchase one before you start enjoying the freedom of having your own ride.
Keep in mind that if you drive without insurance, you are driving illegally. You are also putting yourself at risk for various potential issues as well.
If you don’t want to get into any legal problems and suffer through the penalties and stress that come with them, it is best to get insurance as soon as you get a car.
2. You need sufficient protection from financial liabilities
If you get into an accident with another vehicle and you are at fault, then you will need to pay for the repairs or replacements done on the other vehicle.
Additionally, your car could also sustain some damage when you have an accident. Without coverage, you will be paying the repair fees on your own. You will have to dip into your savings, use your credit card, or take out a loan. Whatever option you pick, you are sure to end up spending a significant amount of money.
When you have the right coverage, particularly a comprehensive car insurance policy, all the damage that your vehicle incurred will be covered. You won’t have to pay out of pocket for any repair or part replacement, regardless of whether you caused the accident or another person is at fault.
A comprehensive auto insurance plan will also cover the damage incurred by all vehicles involved in the accident.
3. You want to be prepared for medical emergencies
In most instances, traffic accidents don’t only cause damage to vehicles; they often lead to injuries, too. If you want to avoid the high costs of hospital and medical bills, you need to have car insurance.
When you have the right auto insurance policy, you can claim insurance coverage on medical bills. You will be entitled to a particular amount, as stated in the insurance plan, in case you get hurt during an accident involving the covered vehicle.
This amount can cover the medical expenses you have incurred, including those of the passengers, if any.
Additionally, some insurance providers extend the coverage to include emergency medical charges as long as they do not exceed the amount stated in the policy.
4. You haven’t paid your car in full yet
If you live in an area where car theft and hijacking are frequent occurrences, and you’re still paying for your automobile, you need the extra protection auto insurance provides.
This is because when you have a comprehensive car insurance policy, you will be covered up to the ACV or Actual Cash Value of your vehicle in case it gets stolen or damaged during a break-in.
A comprehensive car insurance policy is the only type of coverage that reimburses holders in the event of car theft or damage due to a robbery, even if the vehicle is recovered. Because of this, you won’t have to worry about paying for something that you don’t have.
Additionally, if your policy has rental reimbursement coverage, you will get your rental car fees back (up to the specified amount on your plan) while your insurance provider processes your claim.
This will be a big burden lifted from your shoulders in the event that you lose your car, and you really need a vehicle to get around. You won’t have to spend more than you have to on renting an automobile.
5. You want to have a good track record
Lastly, if you don’t get insurance now and wait too long before purchasing one, you will encounter some difficulties once you decide to get it. This is particularly true if you figure in an accident and decide to get coverage primarily due to this reason.
One of the basic details you need to share with your insurance provider is the date when you got your car. If you have already had it for years and you only buy a policy now, you will be asked why there is a gap and why you are only getting one this year.
If you lie and say that you never drove your car until now, you are making a false statement on your application. If the insurance company finds out the truth, they will not pay you anything if you have an accident.
To establish a good track record and get reasonable premiums on your coverage, purchase car insurance as soon as you obtain your vehicle. Additionally, never default on any payments so that you can rely on your policy anytime and avoid encountering any difficulties when you need to file a claim.
Whether you are buying a brand new or pre-owned vehicle, make sure you include a car insurance plan in your overall budget. By doing so, you will have peace of mind once you become a car owner. You will also enjoy all the time you spend on the road more.
Erin Daniyel is the VP for Revenue Operations at Rubicon Project and spokesperson for CompareDubai, an online comparison portal which provides customers with a one-stop platform to compare insurance quotes offered within the UAE. CompareDubai delivers quotations from a number of insurance providers covering a range of products, from Car Insurance to Motorbike, Yacht and Boat, Medical, Life, Business and Home Insurance.