Every motorist is on the lookout for ways of reducing their car insurance costs. This is all good, but you should be careful with how you reduce these costs, and how cheap you want your insurance to be. This is because dirt cheap insurance has some hidden costs that might affect you badly when you need your coverage. For example, an extremely cheap auto insurance:
May Restrict You to Low Mileage Limits
As hinted above, there are different tricks and tips for lowering auto insurance. For example, you may tell the insurance company that you don't drive that much. Your low mileage factor might be taken into consideration, but you will be restricted to a certain number of miles per year. If you aren't careful, you might underestimate your annual driving mileage, and you may end up with a very restrictive policy.
Limited Coverage for Some People
Some auto insurers also offer cheap packages for motorists who agree to limited coverage for some members of your household. Excluded persons usually include risky drivers such as high-risk drivers or permissive drivers, especially if the respective persons are teenagers (who are already perceived as risky to insure). Even if such drivers aren't excluded, they may be subjected to the barest minimum liability limits.
Deny You Special Benefits
Many insurance packages, even the standard ones, come with perks that the companies use to entice new motorists to buy their policies. Some insurers also offer special benefits as loyalty rewards to car owners who have been with them for a long time.
For example, you may be entitled to an accident forgiveness benefit. This means your rates won't hike even if you cause an accident. However, you shouldn't expect such perks if you have managed to negotiate for exceptionally low rates.
May Not Protect You from Punitive Damages
Lastly, you may find that your special low rates do not offer protection for punitive damages. Remember that your state may charge you with punitive damages if you cause an accident, especially if it is proved that you were charged with gross negligence. Those damages can be very costly, but you may be forced to pay them out of your pocket if your rates are extremely low.
As you can see, you should be very careful with the type of auto insurance coverage you buy. Ensure that your policy offers you the coverage you need. It is better to pay a little bit extra money and get the protection you deserve than to pay dirt cheap rates and remain exposed to risks. To find out more about insurance, speak with a company like Illinois Automobile Insurance.