So you have just bought a new vehicle and you want to drive it home – but you do not have the right coverage to legally operate it. While many companies offer immediate coverage, more often than not they require a down payment. What if you cannot afford to make a payment immediately?
Why Do I Need Coverage?
Having coverage is essential if you are intending to drive your newly-purchased vehicle. For the majority of states in America, there is a legal minimum amount of coverage that you are required to have in order to operate a motor vehicle, and the penalties for driving without insurance can be incredibly costly. From getting a ticket to having your car impounded and being arrested for the offense, the consequences are dire.
Legal repercussions aside, you must take into consideration what could happen if you were to be involved in a road traffic accident. Without coverage, any repair costs would be entirely your responsibility, and if you were found to be at fault for the collision, legal and medical fees could also fall into your lap.
Is Zero-Down Coverage Viable?
A quick Google search for ‘Buy Now, Pay Later’ insurance provides hundreds of hits, but do these deals really exist? They can be tricky to find, and for good reason – a zero-down policy is a huge gamble for insurance companies.
There are several reasons a coverage provider needs a down payment. The initial cost covers setting up the policy, which includes running a check on your driving report which is not free. Providing a down payment demonstrates that you are a lower-risk client, which is in the company’s best interest. If you are looking to acquire coverage with no down payment for a reason such as being able to drive a car from a sales lot, this is a red flag for a coverage provider.
That being said, there are in fact companies that offer zero-down, instant coverage. The best way to make the most of these offers is to have all the information you need when you are applying.
What Do I Need for My Application?
Make sure that you have all of your personal details available when you are speaking with your coverage agent, as well as information about the vehicle you want to insure. You will need to know the make, model, and year of your vehicle at the very least.
Consider the following when you make your application:
- Driving record – is your record clean? Have you been involved in a previous accident? If your driving record is not clean, you may find you’ll have a hard time finding zero-down coverage.
- Penalties – Something as small as a parking ticket can impact your chances at finding the coverage you need.
- Vehicle safety precautions – Does the vehicle you want to insure have safety devices? Anti-theft? An alarm or wheel locking system? Tell your agent and this may work in your favor.
- Level of coverage – Wanting a higher level of coverage than just basic liability is reassuring for your agent and shows that you are genuinely looking to invest in a longer-term policy.
- Deductible – For the same reason, increasing the amount of your deductible, the amount you are willing to pay out of pocket should you make a claim, will not only lower your premium but improve your chances of approval.
Zero-down coverage may seem like the quickest and cheapest option for your vehicle needs, but considering the risks you pose to your potential insurance agent, it could prove costly in the long run. Consider making a small down payment if you are able to, or be prepared to make a payment very soon after coverage begins, which could help to lower your monthly premiums in the future.
Insurance may seem expensive, but not having coverage can cost you even more in the long run. With the option to buy now and pay later, you can rest assured that even if your monthly premium may cost a little more, you will always be able to afford the coverage you need to operate your vehicle.