Why Continuous Coverage Is So Important
What is Continuous Coverage:
One of the things insurance companies consider when they quote an auto policy is the length of coverage in your insurance history. A long or unbroken history of insurance will be rewarded with lower rates. It also protects against any unforeseen events when you’re out in the world. Insurance companies like to see continuous coverage for many reasons; one of which is consistency. Consistent coverage is rewarded while those who aren’t are penalized.
Types of Drivers
-New to The Road-
Teenagers are a great example here. When a young adult gets licensed, they generally are included on his/her/their parents auto insurance policy (until 18 at least). Sometimes this can go longer than 18, kid goes to college or lives at home after secondary school. Eventually though it is expected that they will purchase their own policy for insurance and when that happens, they will be starting with a zero length in coverage. It is worth noting that some insurance companies do offer programs to help young adults in gaining their own coverage. Make sure to ask your agent about those companies for more information.
-New to Insurance but Not the Road-
Are you a driver that’s still on someone else’s policy and you’re over 25? That’s okay and not unheard of. You’ll be starting from square one, with zero continuous coverage. No “youthful driving year’ programs will be available either but that doesn’t mean you can’t get coverage. It is encouraged to start your own policy in your beginning years of driving so you have lower rates before adulthood; so you don’t have to use what we call “high risk coverage” insurance.
Luckily if you’re buying a policy for the first time you can count on your rate going down as soon as you’ve proven yourself a responsible driver (aka pay your premium and maintain a good driving record). This establishes positive insurance history. After that your rate will continuously show more of a benefit unless you let it lapse again.
-Someone Else’s Policy but You’re Driving-
Even when you don’t own the vehicle you drive (ex. company car) its best to have your own general liability insurance at the very least. When your insurance coverage lapses it can cause you to be stuck with a high-risk insurance. This can leave the person lapsed in insurance coverages susceptible to financial hardships due to unexpected events, and premium rates and eligibility.
Sometimes you get a job that gives you a company car. They tell you it’s insured through your job and what that means is you’d be listed under the policy. However, that doesn’t help your personal history with insurance coverages. Having your own policy even with a company car is ideal to keep a positive insurance standing for you personally. Jobs change just like coverage rates per insurance company. Talk to your independent agent to learn what policy fits best while you’re using someone else’s car.
-Shopping for Your Needs-
Just because your insurance carrier provides a loyalty discount for staying doesn’t mean you shouldn’t explore your options. Talk to your independent insurance agent/broker about ALL your options. Never a bad idea to shop your insurance and make sure you’re getting the right coverage at the right price.