Questions The Car Insurance Provider Will Ask During Your Application

Whether you need car insurance for your new car or want to switch companies, it's essential that you facilitate as smooth an application as possible. This process will determine whether you can get the coverage and how much you'll be expected to pay as a premium. Insurance companies consider several factors to assess risks and set the rates. When you take the time to understand the questions they will likely ask, it is easier to navigate the process successfully. This post highlights some questions you will need to answer honestly to avoid issues later on, particularly when making a claim.

Do You Wish to Use the Vehicle for Work?

If you have bought a car and intend to use it for your personal needs, e.g., to travel and move around conveniently, you shouldn't use it for work. For instance, you cannot use the vehicle to make deliveries or for sales and marketing campaigns because the primary auto policy doesn't provide coverage for commercial activities. To use the vehicle for commercial activities, you'll need to inform the insurance provider from the beginning so they can offer an additional or alternative policy. This information will also help them calculate the premium accurately.

Where Will You Be Parking the Car?

Insurance companies can charge different rates for car insurance plans depending on where you live or intend to park the car. Specifically, if your area is known for vehicle theft or you don't have a garage space for your car, the risk of theft, vandalism, and damage will be high. This is particularly true for those who reside in cities. The insurance company will charge a higher rate than for clients living in the suburbs.

Is the Automobile Leased or Financed?

If you require an insurance company to provide coverage, you must disclose whether the vehicle is financed or leased. A leased car should be returned to the owner in good condition after the expiry of the lease. For this reason, you will be expected to insure it for its total value. Thus, the comprehensive and collision plans will cover any losses fully.

Do You Have Other Drivers In Your Home?

Many insurance companies provide discounts to clients who buy multi-driver policies. The offer accounts for all the drivers in a household and considers everyone's driving history before setting the premium. This means that the drivers' average risk levels will determine the quote. To benefit from this plan, the other drivers should also have a great driving history. Notably, young drivers will increase the rates because they are considered high-risk.

When you answer the questions honestly, the application process is less stressful, you avoid problems with the insurance provider, and you get your claim settled quicker if the need arises. 

For more information about auto insurance, contact a local company.