Be Smart Buying Coverage for Auto

Dear Action Line: Last Tuesday's column on auto insurance realities for first-time car owners got the attention of my 17-year- old. Now, how about an explanation of the factors of auto insurance pricing. -- M.O.M., Tulsa.

The Oklahoma Insurance Department's Web site offers a must-read for young people or any first-time buyers of a first auto insurance policy. See "Choosing your automobile insurance policy" attulsaworld.com/OIDautopolicy$ .

The "Ways to Save Money" section mentions "good student grades" as a way to impress the insurer that you are trustworthy and have your mind on the future. It's also wise to guard your good driving record -- no moving violations, no accidents and certainly no "driving while intoxicated" situations.

The site mentions other ways to qualify for rate discounts. Three- year discounts are mandatory for those who "successfully complete an accident prevention course approved by the policyholder's insurance company." These are listed in the Tulsa Yellow Pages under "driving instruction," offering "defensive driving classes." Ask your insurer for a list of driving courses it approves. The discount doesn't apply to court-mandated courses taken after motor vehicle violations or alcohol/drug-related offenses.

Other optional discounts include anti-theft devices on the car; vehicles with anti-lock brakes, air bags or daytime running lights; continued policy renewals; high school driver's ed class completion; no insurance claims; good credit score; and placing another type of policy with the same insurer.

Other tips include avoiding penalty assessments by paying your premiums on time and not letting your coverage lapse to save money in the short term. When you do this, you put yourself at financial risk and negatively affect your insurance history.

Control your auto insurance costs by considering the cost of insurance when shopping for a car. Insurance rates vary with the type and model, so check out these costs before you actually buy the car. Are you sure you really need a hot, expensive car? SUVs, convertibles and performance vehicles cost more to insure than other cars.

Be prudent but don't overdo it when buying liability coverage. Young people typically have a low net worth and don't need hundreds of thousands of dollars in liability coverage.

If you buy a used car, or your parents give you their old one, consider dropping collision coverage and comprehensive coverage to cut the premium. With older cars, the cost of these options exceeds the value of the car. It's more practical to take the money you save by not having it and putting it in the bank for your next used car. Also consider raising your deductibles, as higher deductibles reduce premium costs.

Submit Action Line questions by calling 699-8888 or by e-mailing phil.mulkins@tulsaworld.com or by mailing it to Tulsa World Action Line, PO Box 1770, Tulsa OK 74102-1770.

Originally published by PHIL MULKINS World Action Line Editor.