3 Common Car Insurance Mistakes To Avoid

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01 Jul 3 Common Car Insurance Mistakes To Avoid

Choosing the right car insurance is as important as buying the right car. And while choosing car insurance may seem a simple process at first glance, often, when things go wrong, you find out too late that you’re not covered or the insurance policy doesn’t pay out what you expected it to. Smart car owners know that there are three mistakes to avoid when it comes to car insurance: not understanding their insurance needs, not shopping around and comparing quotes, and not disclosing relevant information.

1. Not understanding your car insurance needs

Over-insuring or under-insuring a car is a big problem for car owners. While over-insuring your car means you’re paying too much for each premium, under-insuring could leave you short and having to cover the bills when things go wrong.

All car insurance policies have limits and it’s vital you understand what yours are. Not knowing how your car insurance works can lead to nasty surprises when it comes to making a claim.

To help you understand what you can reasonably expect your car insurance to cover, be sure to read your policy documents or go over them with an experienced Insurance Adviser like those at Max Insurances.

Car insurance can be one of three types:

Third party

This is the least expensive car insurance type, which covers the cost of damages to just the other person’s vehicle or property should you damage someone else’s car or property.

Third party, fire and theft

This type of car insurance covers your legal liability if you damage someone else’s property or car, and if your car is stolen or catches fire you’re covered.

Comprehensive car insurance

This car insurance covers the widest range of situations, including damage to your own car, damage to someone else’s car or property, as well as additional costs like towing if your car breaks down as a result of an accident.

If you’re unsure about which type of car insurance cover is right for you, get in touch with an Insurance Adviser, like those at Max Insurances, to help you work through the options and find the right car insurance for your situation.

2. Not shopping around and comparing quotes

Just as your financial situation can change over time, so too does your car insurance rates. That’s why it makes sense to shop around at least once a year for car insurance and compare quotes, to ensure you’re getting the best car insurance cover for your current situation.

And if you’re a buying a new car – or a “new-to-you” car – it’s a good idea to start shopping around for car insurance early. That way you’ll have time to compare car insurance policies and get advice about the right car insurance for your situation.

To save yourself time, work with an Insurance Adviser like those at Max Insurances. Our experienced and friendly Insurance Advisers specialise in helping Kiwis arrange insurance NZ wide, and would like to work closely with you to understand your needs, and then shop around on your behalf. We can help you compare quotes and understand what’s included and what’s not. And, we’ll help you keep your car insurance cover up to date, to ensure you’re always getting the right car insurance cover for your needs.

3. Not disclosing all of your information

No matter what type of car insurance cover you choose, it’s important that you disclose all relevant information that insurers require and answer all questions truthfully. If you disclose fraudulent information, or you withhold relevant information, your insurer may reduce a claim payment or even refuse a claim.

You must disclose all information that is relevant, which may include:

  1. Minor criminal offences
  2. Minor traffic offences
  3. Previous rejections for insurance cover
  4. Previous insurance claims

Failure to disclose any of these could impact your ability to make a claim in the future.

Your car insurance cover should ideally be a reflection of your current situation. Any time your situation changes, your car insurance cover may need to be updated too. If you’re in doubt about what your insurance provider needs to know, rather over-disclose!

Remember to update your car insurance details if:

  1. You move home or your address changes.
  2. You park your car outside instead of in a locked garage.
  3. You make modifications to your car, or install any upgrades or additional parts.
  4. You use your vehicle for business more regularly.
  5. Someone else is driving your car – particularly important if the additional driver is not on a full licence or is under 25 years old.

The right cover to fit your needs

When it comes to car insurance, it can be hard choosing the right cover and understanding the various options, inclusions and exclusions. At Max Insurances, our Insurance Advisers understand that providing the right advice helps you plan your long-term financial wellbeing. With access to a wide variety of insurance providers and knowledge of insurance products, our Insurance Advisers make it easy for you to explore your insurance options and make an informed decision. Get in touch today for advice about car insurance. Or simply fill in our online quote form to get a free, no-obligation car insurance quote!

In addition, if you need help with car finance, our Personal Lending Team at Max Loans can help you get a pre-approved car loan to finance the purchase of a car. Car finance through Max Loans usually comes with competitive interest rates and flexible loan terms. Give us a call on 0508 629 5626 to find out more about what we can offer!

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