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6 Tips to save on car insurance

Comparing the different offers is one of the most important points when it comes to saving on your car insurance. © Pixabay

If you are thinking of buying or renewing your car policy, it is important that you know that there are some tricks that will help you decide on the best option without paying more. Follow this guide and discover how to save some dollars.

Today, the market for insurance companies is extremely competitive and they strive to always offer the best offer to their clients.

In this sense, it is very possible that at the time of contracting a policy you can opt for very good prices and excellent coverage.

To achieve this, it is important that you know how to choose and that you know some tricks that will help you save when buying your car insurance.

Let’s review the most important tips:

1: Define your driver profile

When defining your needs in terms of car insurance, it is important that you look at different aspects:

  • What is your profile as a driver?
  • What are your driving habits?
  • How many kilometers do you travel a day?
  • Do you regularly circulate in the city, highway, or rural roads?
  • Do you use your vehicle for any commercial activity?
  • Do you have a long history of traffic violations?

All these points will be important when calculating your insurance rate and cannot be left adrift. Do not forget that your age and the age of your driving license are also essential factors for insurers.

2. Check the characteristics of your car

The policy premium will also depend on the characteristics of your car. In this sense, all factors will influence the final price.

  • What type of vehicle do you have?
  • Is it new or used?
  • What is the power of the car?
  • Do you have an alarm?
  • Where do you keep your car at night?

It is important that you bear in mind that the more expensive your car is or the more power it has, the more expensive the insurance will be.

At the same time, security equipment such as alarms or others can reduce the value of the monthly payment.

3. Limit coverage

At this point, it is important that you know exactly what coverage you need and that you do not try to contract unnecessary guarantees.

Currently, companies allow each policy to be adapted to the needs and characteristics of the client and thus limit costs. However, do not try to save too much and be unprotected against possible risks.

For example, if your car is always parked in closed garages and is rarely left on the street, perhaps you could waive the theft coverage. Again, this will depend on your own needs.

4. Don’t forget the franchise

Analyze the possibility of taking out insurance with a franchise, since this option can considerably lower the value of your policy.

The franchise is an option through which, in the event of a claim, the insured agrees to pay part of the damages and repairs.

This is a good measure if you opt, for example, for comprehensive insurance. Remember that the possibility of suffering a loss classified as the total loss of the vehicle always exists.

5. Compare the different offers

The most important stage when saving on your car insurance will be to compare the different offers offered by the market and analyze each of the policies offered by the companies.

There are many insurers that offer fairly similar premiums but with a wide difference in their prices. This is why it is not enough to consult a single company.

Choosing the best car insurance company is a task that requires a lot of time and dedication, however, depending on your decision, you can save on your car insurance without losing guarantees.

Once you know what coverage you need, you must list and select the best options and then review their specific conditions and thus be able to make the best option.

Today, there are different mechanisms to perform an effective car insurance comparison. we offer you all the tools and information you need.

6. Negotiate with the company

Once you have chosen the insurance and the company that best suits your needs, we advise you to go personally to the insurance companies’ offices.

Your good driver profile or the risk of losing yourself as a new customer can make it offer you better prices, more guarantees, and good coverage.

At the same time, if you want to change companies, don’t forget that it will try to match the offer of the competition so as not to lose you as a customer.

Guide to choosing the best car insurance for young people

car insurance for young people © Pixabay

If you are young and have just got your driving license, you may be interested in knowing how to choose the best insurance for your car. And, although this process is usually not an easy task for those under 25 years of age, in this guide we tell you everything you need to know.

Although insurance companies are aware that every owner of a vehicle must have a mandatory minimum policy that covers, at least, the civil liability of the driver, they are determined to hinder young drivers by charging high premiums and stipulating a large number of conditions.

Indeed, if your age is around 20 years old and you already have your driving license, perhaps you have already learned how difficult it is to find an entity that accepts insurance without charging excessive prices.

Let’s review in this guide some tips that will help you hire the best car insurance and the one most adapted to your situation, always at the best price.

Young drivers, the great fear of insurance companies

As we have previously announced, Spanish legislation obliges every driver of a vehicle to have an insurance that covers, at least, the civil liability that allows covering the physical and material damages that you may cause to third parties.

However, companies do not always agree to insure young drivers between the ages of 18 and 25.

The reason for this is that insurers consider that the risk of covering inexperienced drivers is very high.

Indeed, all those who have less than two years of experience on the roads will be considered as such and therefore will be part of the high-risk group.

In this sense, and because they are private entities, companies are not subject to any type of obligation that requires them to offer you insurance for your car. Quite the contrary, if the entity decides not to insure you, it will be fully entitled.

And, although there are some insurers that will not want to insure you, others will, but for prices of up to 60% more expensive than for a low-risk policy.

Remember that, in general, the greatest risk you pose to the company will be related to your young age and little experience, however, there are other factors that may influence your decision.

If you have bought your first car and it already has several kilometers on it, rest assured that your risk profile will be even more important.

Tips for finding the best youth car insurance

© Pixabay

While these tips do not guarantee that the company will agree to insure you, they will most likely help you find a policy that suits your needs without paying a fortune.

  1. A new car will always have a higher risk for insurersTry to use a slightly older vehicle as you gain more experience as a driver.
  2. Try to find a policy that includes only the coverage you really need. Do not forget that the more coverage you intend to contract, the higher the premium payment will be. 
  3. If you are going to buy a car, opt for one that does not have many displacements, otherwise, the premium will go up automatically.
  4. If you like the automotive world and your dream of modifying your car so that it has more power or more attractive design, you should be aware that your percentage of risk with the insurance company will be higher.
  5. When buying a car, whether new or second-hand, we advise you to opt for one that runs on gasoline as the insurance premium will be cheaper.
  6. If you want to save even more when purchasing your car insurance, we advise you to opt for a policy with a franchise. 

Can’t get insurance for your car? There is a solution!

If you have already resorted to all the companies and you do not get any insurance, you can contact the Insurance Compensation Consortium. This entity is in charge of accepting all those drivers who have not been admitted by private insurers.

The Insurance Compensation Consortium will offer you a policy that is regulated by Article 5 of the Regulations for Mandatory Civil Liability insurance that stipulates the following:

“The body will accept the contracting of the risk when 2 requests for compulsory insurance have not been accepted or have been rejected by 2 insurance companies, unless the risk was accepted by another or other insurers at the request of the Insurance Compensation Consortium”.

Remember that this insurance only offers the minimum mandatory coverage or Civil Liability. At the same time, it is important that you know that in order to hire it, you must show that at least two private companies rejected your request.

10 tips to get the best car insurance

One of the keys will be to compare the different offers on the market. © iStock

The most important step that you must take after having signed the purchase of your new car is choosing insurance that protects you against a possible loss. To choose the one that suits your needs without having to pay a fortune, we advise you to follow these 10 practical tips.

One of our main concerns when purchasing a new car is to know which of all the types of car insurance we should take out and if the policy we take out will suit our needs.

Well, although the Law only requires us to have the minimum Civil Liability insurance, many of us opt for more complete coverage that better protects us against any type of unforeseen event.

Given this, and if you still do not know how to choose the best insurance for your car, today we present 10 tips that will help you when you want to subscribe to a policy appropriate to your vehicle and your needs.

1: Define a budget

The first step that you must take before deciding on insurance or another is to set the budget you want to allocate for your car policy.

You must be clear on this point before starting your search since the price differences for the same type of insurance can be very large depending on the company that sells it.

For this reason, we advise you to analyze your possibilities and set the maximum amount that you can invest annually or monthly in your car insurance.

2. Analyze what type of coverage you need

Once you have set the budget that you want to dedicate to your car insurance, you must know what type of coverage you want to hire, what your needs are, and what type of guarantees are not relevant to you. Today, there are quite a few types of insurance and each one offers different coverage.

Remember that apart from the mandatory policies, among which are Obligatory Civil Liability, Driver’s Insurance, Legal Defense Coverage, and Windows, there are different options that you can add to your basic insurance and that will significantly increase the total price of the policy.

Some questions that you can ask yourself when analyzing your needs are the following:

  • You’re young? Have you had your driver’s license for less than two years?
  • Do you live in a potentially dangerous sector or do you have a high-risk perception?
  • Do you regularly circulate through difficult areas or areas with a lot of vehicle traffic?
  • Are you a responsible driver? Have you had any car accidents?
  • Will you be the only driver of the car? Remember that there are different types of drivers depending on the use they give the vehicle.

It may happen that at the time of signing your policy you have other specific needs such as obtaining car insurance coverage abroad, travel assistance, replacing the car in the event that yours is referred to a workshop, etc.

3. Comprehensive or Third Party Insurance

Once you have recognized what your main needs are, it is time to decide if you want your policy to be Full Risk or Third Party only.

Although experts advise that for new cars it is better to take out Full Risk insurance and that for cars older than three years a Third Party policy is enough, the truth is that everything will depend on the offer you can find in the market. timing and fine print of the contract.

Today, there are many possibilities where a Third Party insurance offers practically the same coverage as an All Risk insurance, and without so many restrictions.

4. With or without franchise

The topic of the franchise is one of the most discussed points when choosing the best car insurance.

It is true that a Comprehensive policy with excess is cheaper than one without excess. However, if you take this option, you should know that in the event of a minor repair the insurer will pay a very low percentage or, simply, will not cost anything.

But if you are one of those people who prefers to prevent and who always see the risk first, an All Risk insurance with excess may be the best option in case you suffer a total loss.

In this case, the company will pay for a fairly high value of the car and, in some cases, can even pay it back completely.

5. Select the car insurers

Once you have finished analyzing the different points to know what type of insurance suits your needs, it will be time to start the search.

In this sense, the first thing is to select a group of between three and five companies.

Choosing the best car insurers will help you save time, keep your ideas clear, and not get confused among the thousands of offers that exist in the market.

6. Request quotes

This point may take some time but it is very important that you do it thoroughly.

The first thing is that you request a quote for the type of policy you are looking for from each of the selected insurers.

I advise you, at first, to carry out this operation online. The companies have advanced sites in which you can request an online quote or review the different offers they propose.

Then, write down each insurance that you find interesting on a sheet and write down the most important characteristics of each one.

7. Use an insurance comparator

A car insurance comparator can be very helpful especially if it has been difficult for you to find the policy you are looking for in the different insurance company sites.

Currently, you can find different comparators that just answer a couple of questions offer you a list of the most convenient and economical insurance.

8. Call the insurance companies

It may happen that you cannot find all the quotes you are looking for on the Internet or that you prefer to make sure of the prices and promotions that appear on the Web.

Given this, I recommend that you call directly those insurers of which you still do not manage the characteristics and prices of their policies.

On some occasions, the rates that appear on the Internet may have varied. It can also happen that if you call the company directly, it offers you some type of discount or that it proposes a type of policy that is better adapted to your needs.

9. Review the contract and specific conditions

If you have already decided on the best insurance for your car, it is time to take a look at the contract and review all its terms very well.

Among the points you should keep in mind are:

  • Coverage
  • Franchise
  • Right to demand
  • Particular conditions

Remember that the car insurance contract is a mutual agreement, so if you have any questions or do not agree on some point, your company should be able to negotiate.

10. Cancel your old insurance

If you had previous insurance, don’t forget that it’s time to cancel it.

For this, all you have to do is get in touch with your old insurer and communicate your desire to cancel your car policy.

In some cases, the company will send you a document for you to sign and formalize the operation.

What is the coverage of windows in car insurance?

Windshield insurance does not consider certain windows such as interior and exterior rear view mirrors. © Freepik

One of the additional guarantees that you may need when hiring your car insurance is the glass coverage. We explain how it works, in which situations it applies and what are the elements that are included in it.

If you want to take out the best car insurance, you most likely want to find coverage that fits your needs but also fits your pocket.

Today, there are a large number of companies that offer a wide range of offers and promotions. And there is insurance for all tastes, from the most basic to the most complete.

In this sense, when comparing the different policy options, we advise you to take into account all the coverages that exist and not only those imposed by law such as civil liability.

Many of the coverages that you can contract together with your car insurance will seem useless, however, in the event of an accident or any type of claim, they can be very useful.

One of the guarantees that you can include in your insurance policy and that can save you a few dollars in the event of a loss is the window insurance coverage.

Let’s review in this guide what it consists of and in which cases it should be used.

Glass coverage: what does it consist of?

Windshield coverage consists of compensation from the insurer in the event of an accident and where the front window (windshield), the rear window or the side windows of the car have broken.

Generally, the glass insurance covers the repair or total or partial replacement of these glasses. In turn, the insurer will assume the labor used for the removal of the damaged windows and the installation of the new windows.

What are the elements that the glass insurance does not cover?

If your car has other types of glass, apart from those we have mentioned above, it is important that you know that each company will set its own exclusions in this regard.

In this sense, the crystals that are not usually included in this type of policy are:

  • Rear view mirrors both interior and exterior.
  • Lights or indicators of the car.

In the case of sunroofs, there are insurers that include them within the coverage provided that it is part of the standard equipment. However, much of the window insurance excludes this element.

In which cases can the windscreen cover be valid?

Damaged front window

The windscreen coverage is valid when they have been damaged as a result of an accident or loss beyond the control of the driver or the insured.

You must know that any damage caused by use or by small impacts on the car cannot be part of the insurance coverage.

You should not forget that in case of theft or fire, it will be this coverage themselves that will assume the compensation of the windows in case of having them.

At the same time, if you have taken out a policy with coverage for your damage, all the glasses excluded within the window insurance may be covered by this guarantee.

What are the advantages of window insurance?

Although many consider that glass coverage is not an essential product when choosing car insurance due to the low value of compensation compared to the cost of it, it presents an advantage that should not be missed.

In effect, if you take out a car policy with window coverage, your insurance will automatically become “consortial”.

That automobile insurance is «consortium means that this policy will receive all the guarantees. In the event of a claim due to Extraordinary Risks, it is this entity that will have the obligation to assume the coverage.

Where are damaged windows repaired?

Contrary to what many policyholders believe, the company cannot dictate the repair shop. Quite the contrary, each client is free to choose the place that suits him best.

However, the vast majority of companies recommend one of their partner workshops to do the glass repair.

4 keys to calculate the rate of your car insurance

Another point that can also affect the price of your insurance is the type of profession you have or the work you do. © iStock

To calculate the price of a policy for your car, insurers take into account different factors that vary according to the insured and their life history. For this reason, before making a decision between one coverage or another, we advise you to know what these points are. Take a look at this guide!

Having car insurance that suits your needs not only means that you are complying with the laws and that you will avoid a large fine.

Hire the best car insurance can mean great peace of mind in the event of a claim not only for you and your family but also for those third parties with whom we did not expect to cross.

However, we all agree that finding the right coverage is not always easy. But if you know how insurers calculate the value of their policies according to each client, the path to the correct choice will be much more bearable.

Let’s review below those factors that the company will take into consideration when calculating your car insurance:

The driver

Undoubtedly, the first factor that the insurance company will take into account when calculating a car policy is the characteristics of the driver taking the insurance.

In this sense, there are several components that alter its final price, and that influences the increase or decrease of the risk percentage. Do not forget that insurers consider, according to their characteristics, various types of drivers.

Let’s review the most important points:

Age

If your driving record is empty or if you have all the points on your driving license, it is very likely that the insurer does not have enough information to determine your risk factor and know if you are a responsible driver or not.

However, the company can draw on statistical data and use an average of behavior according to the ages of former customers.

It is important that you know that, usually, the youngest drivers (between 17 and 25 years old) are in the first risk step and are more likely to suffer an accident.

Also, the more years you have driving experience and the older your identity card indicates, the lower the price you will have to pay for your insurance.

Occupation

Another point that can also affect the price of your insurance is the type of profession you have or the work you do.

Indeed, certain occupations have been shown to have a higher risk of car accidents, which generates an immediate increase in the price of the policy.

Place of residence

The place where you live also alters the risk factor of the insured.

Keep in mind that if you live in a big city with high congestion rates or if your house is located on a mountain that is difficult to access, the chances of having an accident are higher and the value of the coverage as well.

Car use

Depending on the use you want to give the insured car, the company can also vary the cost of your policy.

It is important that you know that insurers calculate the time that, depending on the route you usually take, you will spend on the road, in the city, on dangerous routes, in hours of congestion, etc.

In turn, the estimated number of kilometers that you will travel in a year will also serve as a guide for the company to calculate your coverage.

Don’t forget that the more you drive, the more likely you are to have an accident and file a claim.

The car

As you can imagine, the car itself is another of the fundamental factors when calculating the price of a policy.

The type of car you have decided to buy and the characteristics of it can make the insurance go up or down by a few dollars.

Among the points that insurers take into consideration regarding the car itself are:

  • The brand.
  • Its age.
  • The car model.
  • Its value.
  • The power.
  • Your repair costs.
  • The type of fuel you use.
  • The kilometers traveled.

Do not forget that the higher the value of the car or the more recent it is, the more you will have to pay for its insurance.

Ultimately, the company will raise the price of insurance in the face of any factor that may mean a greater risk of loss.

Your conduct history

Do you have many fines in your claims history? Do you have no points left on your driving license? … then you need to know that you will have to pay more than the rest for your car insurance policy.

Every time a potential client requests a car insurance quote, the company accesses his history and verifies his behavior as a driver in recent years.

However, and although most insurers will make you pay more if you have had many violations in recent years or if you are a novice driver already have 2 or 3 claims, each one is free to set its own prices.

The type of policy

The last criterion that insurers take into account when calculating the price of your policy is, without a doubt, the type of car insurance you want to take out.

In this sense, it is logical to think that companies should vary their rates according to the risk they assume when insuring you.

Taking into account all the previous points, it will not be the same for a company, to offer you only Civil Liability coverage than to offer you Full Risk coverage.

You must bear in mind that the more risks are covered by your insurance, the higher the price you will have to pay. And at the same time, the more people are insured, the higher the final cost will also be.

5 steps to choosing the best insurance company for your car

Comparing the different offers represents the most important step in deciding on one or another company. © Pixabay

Looking for an insurer for your new car? Do you want to change the company? Do you need a company that gives you confidence and good coverage? Follow the five steps that we give you below when choosing your insurer and do not lose money or quality of service.

Faced with a large number of insurers currently invading the market, finding a company that is capable of meeting all your needs is not a very easy task.

However, and although your priority is to save money and find the cheapest offer, there are other factors that are decisive in the decision of a future insurer for your car.

Let’s review five steps to choose the best insurance company for your vehicle taking into account criteria that you should not miss.

Define your priorities

The first step you should take before deciding on one or another insurer is to find out what the market is currently proposing and prioritize your needs.

To help you, I advise you to answer the following questions:

  • Are you looking for insurance that only meets the minimum requirements stipulated in the mandatory policy established by law?
  • Are you willing to pay more for better coverage?
  • Do you need any type of additional coverage?
  • What means do you want to use to make the contract?

Once you define your priorities, you can make a list of those points that, in your opinion, should be present at the time of signing a policy.

Find your driver profile

If you think that the car insurance that your best friend has taken out is excellent and you think it would be good to take out the same … you are wrong.

One of the first things to keep in mind when looking for a policy for our car is that companies grant a different price to each driver or user who comes forward to sign a new contract.

There are several types of conductors and the factors that define each one are varied, therefore, insurers grant a different risk factor to be able to set the price of their premiums.

In this sense, the second step is to find your driver profile according to a series of factors that I give you below:

  • Frequency of car use: as a general rule, insurers distinguish between two types of drivers according to the frequency with which they use their vehicles (regular and occasional).
  • Age: Insurers can raise the value of your premiums if you are under 25 or over 60.
  • Type and model of car: it is known that certain models and types of cars are more expensive to purchase insurance than others. At the same time, the year of manufacture is also a determining factor.
  • Sex: Although less frequent, some insurers take the insured’s sex into account when setting their premium prices.
  • Geographical area: if you live in an area of ​​mountains or cliffs, it is very likely that the company considers you as a high-risk driver because of the possibilities you have of suffering an accident.
  • Driving license age: for those who have obtained their driving license only one or two years ago, the prices on car insurance are usually higher.

Remember that knowing what type of driver you belong to can help you a lot when comparing offers and determining what type of coverage you need.

Select trusted companies

We all know that there are many insurance companies and that not all of them offer the same thoroughness in their services.

Given this, we advise you to invest a few hours and ask your relatives and close friends their opinion about their insurers.

You can also search the Internet according to the comments of the clients themselves and verify certain data on their web pages.

It is very important that the companies you select offer you confidence. For this, you can go to the website of the Insurance Department and verify that the company is authorized to sell car insurance in the country.

Compare the offers

Undoubtedly, comparing the different offers proposed by the insurers you have selected represents the most important step in deciding on one or another company.

It is necessary that the offers you identify are adapted to your driver profile and that they meet the minimum conditions that you require.

The following list will help you when you do this step:

  • Look at the promotions.
  • Don’t just look for the cheapest policies.
  • Pay attention to the customer service you receive

Analyze additional coverage

After comparing the different offers in a general way and once you have selected two or three companies, it is important that you look at the additional coverage that the insurer can offer you.

Fire, theft, glass coverage … check your priorities and compare which company offers the best additional coverage.

Don’t hesitate to ask for help

If after following these tips you still feel overwhelmed and do not know which insurance company to choose, there is the possibility of resorting to a car insurance broker.

Brokers, unlike agents, are professionals who are not identified with any company and who will be in charge of finding the best insurer according to your needs.

Car insurance: definition, types of policy and characteristics

Insurance companies offer different types of policies, which can bundle two or more insurances at the same time. © iStock

If you want to circulate quietly in your car, it is necessary that you have insurance that covers, at least, the civil liability required by law. To help you, in this guide we give you all the answers that you should know before signing a contract of this type.

What is car insurance or an insurance policy?

In the event of an accident or theft, your car must be protected with some type of contract that allows the insurance company to compensate you for the damages suffered or caused.

In this sense, a policy or car insurance is a modality used in most countries and that allows you to cover the risks that may arise while driving.

It is a contract between the driver and an insurance company which establishes the conditions under which said the company will pay the compensation corresponding to the policy chosen by the interested party.

The insurance policy must include all the coverages and assumptions that have been agreed with the insurer, as well as the compensation to which you will be entitled in the event of a claim, your personal data, and the information on the insured car.

What type of damage does car insurance cover?

Generally, insurance companies offer different types of policies, which can gather two or more insurances at the same time, depending on the coverage that each one includes.

In this sense, it is important that you know that the coverage is divided according to what or who has been affected by the loss :

  • Insurance with coverage to the person:
    • Mandatory / Voluntary Civil Liability
    • Legal Defense Coverage
    • Driver’s Insurance
    • Travel Assistance
  • Insurance with car coverage:
    • Own Damage
    • Stole
    • Fire
    • Moon Coverage
  • Insurance with complementary coverage:
    • Defense in fines
    • Withdrawal of the Driving License
    • Repair loan
    • Substitution vehicle
    • Big damage

What types of auto policy are there?

© iStock

It is true that each company manages its own insurance names according to the different coverage they offer.

However, and to better market their policies, companies have grouped these packages and have come to 4 general names:

Third-party car insurance

Third-party car insurance is a type of policy that is covered by Compulsory Civil Liability insurance, which is essential in all policies.

This type of insurance offers coverage for material and personal damage that, as a driver, you can cause to a third party in the event of a claim.

Many times, this insurance can be complemented with Voluntary or Supplementary Civil Liability insurance, Legal Defense insurance for the insured, and a Driver’s Insurance.

Extended Third Party Car Insurance

As its name indicates, Extended Third Party car insurance is a type of policy that has the same coverage as Third Party car insurance but allows you to contract additional coverage according to your own needs, such as insurance against theft, fire, moons, among others.

Full Risk car insurance

Full Risk car insurance includes the coverage of the first two types of policies in addition to the coverage called Own Damages. The latter guarantees all material and personal damages that are generated both to third parties and to the occupants of the vehicle responsible for the accident.

Undoubtedly, this type of insurance is the most complete and the most expensive, as it includes all existing coverage modalities.

It is important for you to know that Full Risk car insurance covers everything from minor damages such as bumps and scratches to serious claims such as the total loss of the car.

All Risk Insurance with Excess

Generally, the All Risk insurance with Excess is one of the cheapest on the market. This is because the coverage is shared responsibility.

This means that the insured is the one who sets a certain franchise and to which the coverage for Own Damages is applied.

In the event of a claim, the insurance company will only pay the difference between the recorded damages and the amount of the excess.

Compare before signing

If you want to save on car insurance but without losing coverage, we advise you not to rush. The market offers many options and the best thing is to compare all the policies that suit your needs and budget.

Complete Guide to Total Loss in Auto Insurance

Insurance companies use four types of values ​​for total loss automobile compensation. © Pixabay

The coverage for the total loss of the vehicle will act in case of having suffered an accident and that the car is unrecoverable, being the victim of the car theft or after suffering a violent fire and that you cannot do anything to repair it. Do you want to know more about this type of coverage?

What is the total loss of the car?

Total loss is one of the coverages that you can opt for when taking out insurance for your car.

There are three cases in which your insurance company may consider a vehicle a total loss :

  1. If you have suffered a traffic accident and the repair of the car is higher than the current value of it.
  2. If you have been the victim of your car theft.
  3. If your vehicle has suffered a fire and the damage is irreparable.

It is important that you know that claims caused by Extraordinary Risks will be covered by a different entity and not by your insurer.

When is a vehicle considered a total loss?

In the three cases mentioned above, your insurance company could declare your car a total loss. However, it is important that you know certain specifications.

Normally, the insurer will consider your vehicle as a total loss when the repair of the damage after the accident or theft exceeds 75% of the current guaranteed value of the car.

However, it must be taken into account that this percentage will be determined by the insurer, so you can find companies that consider a total loss when the repair of the damage reaches 100% of the current value of the vehicle.

A total loss designation of 75% will be interesting in some cases: recent cars where in the first years the vehicle is covered at its purchase value or in case the damage suffered is serious and affects important parts of the vehicle such as the engine or chassis.

On the contrary, a 100% total claim designation will suit you in case your car is old and the damage does not affect the main mechanisms.

How much will the insurer pay you?

To calculate the compensation that the insurer will pay you when declaring your car a total loss, it will take into account different factors such as the age of the vehicle and the type of car insurance you have contracted.

Currently, insurance companies use four types of values ​​for the total loss of automobile compensation. These are:

Wrecked car
There are different types of values ​​for the compensation of your car. 
© Pixabay

Value again

This type of compensation refers to the fact that the company will cancel the value that a new car costs.

The value of the car will be that of the damaged car, with the same characteristics and taxes included.

It is important that you know that if your car had extra accessories and these are included in the policy, the insurer will include the value in the reimbursement.

When the refund is made, the company can buy the car for you. Otherwise, you can receive the money and choose it yourself.

Venal value

In this case, the company will reimburse the sale value of your car at the time of the accident.

The value of the car will correspond, in this case, to the sale price of a car of the same characteristics and age.

Factors such as the mileage traveled up to the date of the accident or the state of maintenance will not affect the market value.

It is important to remember that if you have included any accessories in the policy, these will also be part of the calculation.

Market value

The insurance company will reimburse the purchase value of the insured vehicle, immediately before the occurrence of the loss.

Replacement value

When compensating the damages through a replacement value, the insurance company will apply the purchase price of a car with the same characteristics and age as the damaged car.

As with the market value, in this case, the kilometers you have traveled or the level of maintenance of the car do not matter.

Are there other factors that influence the compensation value of the damaged car?

Indeed, there are some factors that can greatly influence the value that the company estimates for the compensation of your car.

Among them are:

Appraised value

Before calculating the amount to be reimbursed, the company will assign your car an appraised value. This calculation will be done using different assessment tools.

It is important that you check that the appraised value estimated by the insurer is in line with the real values.

Damage repair value

When calculating the compensation value of your car, it will be the insurer who will check the valuation of the vehicle’s damage.

Given this, and if you doubt the calculation of your company, you have the option of carrying out an independent expert opinion, which has a cost of approximate dollars.

Value of remains

The value of remains can considerably change the compensation of your car at the time of declaring it a total loss.

We advise you to request several quotes to obtain the best offer to present to your company.

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