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 Just as there are many differences between a Toyota and a Lexus, there are many differences between auto insurance policies, although you have to look more closely to spot them. However, choosing a low-cost auto insurance policy may end up costing you thousands of dollars. The familiar pitch, "save hundreds of dollars in 15 minutes," obscures complex coverage issues that may have you paying much more in the end.Your Liability Exposure Many auto insurance policies have low liability limits which don't reflect an individual's true worth. In fact, in several states, the recommended limits are as low as $25,000. Because every auto insurance policy is different, it's best to read your policy carefully and make sure you're not part of the up to 50 percent of drivers who are under-insured. If you are in an accident with someone who is uninsured or under-insured, you could personally be responsible for medical expenses, lost income and other damages. Using a cookie-cutter approach is simply not appropriate for buying auto insurance, especially if you have significant assets to protect or specific needs. You need a custom assessment of your risk profile when selecting car insurance. It's critical to go through an agent who understands and can respond to your individual situation. Sales Representatives vs. Insurance Agents An independent insurance agent will be able to give you details on what a policy covers, and make recommendations on what is best for you, based on your lifestyle. This differs from a telephone sales representative who is often working from a script, and is only able to quote prices, not make recommendations. When talking to an independent agent, it's important to discuss: * The extent of your assets and net worth * Your views about asset protection and insurance * Your expectations if you have a claim |