How Honesty About Your Claims History Affects Your Auto Insurance Policy
You may have been away from driving for a period of time and now it’s time to re-establish an insurance policy on your car in order to be legal. In this case, you want to find an affordable auto insurance policy that will cover you in case of an accident. But to be above board with everything and not realize a penalty later down the road, you want to be completely upfront by divulging your previous insurance claims and claims history to your new auto insurance provider. This keys them into your potential risk, and they will be able to provide you with a rate suited for your needs as well as their own.
Reporting Your Previous Insurance Claims History
By alerting your insurance company to your claims history will allow them to accurately calculate what your risk is for coverage. If you’ve only had one or two tickets and perhaps an accident claim, you shouldn’t see a drastic difference in the premiums associated with your auto insurance policy. If however you have an extensive claims history, you will be viewed as a higher risk. This unfortunately brings a higher rate for your premium.
Being Honest When Buying and Auto Insurance Policy
It may seem a simple thing to do to not be completely honest with your company to gain a lower rate, but this can have dire consequences further down the road. Failing to divulge your previous insurance claims may gain you a lower rate in the short term, but by falsifying information, you make it easier for your insurance company to simply close your policy and place a black mark on your record. This stays with you over the years and can make getting another policy nearly impossible.
When purchasing a new auto insurance policy, simply be upfront. You may well see an increase rate in conjunction with other drivers, but your honesty has shown your auto insurance provider your commitment to reducing your risk in the future. You will also be starting a fresh chapter in your driving history book, whereby you will be able to re-negotiate for a lower rate as the years pass by without incident. When the question is asked about your past, do yourself a favor and be upfront about everything. It could mean the difference between having coverage and being denied.
Image Credit: https://www.flickr.com/photos/loimere/6772341183