Whether buying auto insurance online or through an agent in Clarinda, IA, it’s never easy. With many coverages, insurance jargon, and myths surrounding car insurance, it’s always never straightforward with auto insurance.

The good thing is that you don’t need to be an insurance expert to understand auto insurance. Being in the know of the following basics of car insurance, as highlighted by Sump Insurance, will help you make an informed decision when shopping for car insurance.

Reading your policy document

Most people are quick to sign off their auto insurance plan without understanding their policy document in detail. Understanding your policy document in and out is the first place to start if you are to get the most out of your auto insurance policy.

Your policy document contains what’s covered and what’s not covered by your insurer. This way, you will not encounter surprises when filing a claim.

How insurance rates are determined

Ever heard someone say that red cars attract higher premiums? This is a blatant lie. Your car insurance rate is determined by factors like number of coverages, driving record, claim history, model of your car, your location, and personal details.

While each insurance company has its way of determining insurance rates, it’s pivotal to have a rough idea of what goes into your insurance premiums. This way, you can deter your rates from increasing for factors within your control.

State-required minimums aren’t enough

Each state has mandatory requirements for auto insurance. In Iowa, for example, drivers are required to purchase bodily liability insurance. Besides, underinsured/uninsured motorist coverage is compulsory but can be rejected through writing.

While observing the state’s requirement is superb, these coverages are never adequate. The limits are inadequate, and the coverages cover other people, but not you and your vehicle. As such, we recommend motorists to consider optional coverages, including: