Many people are surprised at the impact of donations on their own premiums.
Watching the recent news headlines has revealed that donating a car in California has become a growing trend in the state, but at the same time, many of these generous individuals and businesses are discovering that the impact that this can have on auto insurance premiums can be a surprising one.
There are many different factors impacting premiums and a donation can alter these calculations.
While many people feel that by donating a car in California, they will automatically experience a reduction in their premiums, this is not always the case. Yes, these drivers may find that by covering one vehicle instead of two will cause their California auto insurance premiums will be reduced, but in many cases, the savings is not as great as they had expected.
It is important to compare auto insurance rates before and after donating a car in California.
Consider the following scenario. If your household has two vehicles and you decide that you no longer need both of them, you could feel that if you donate your car to a good cause, you could help someone else and save money at the same time. However, car donation California trends have revealed that there is an important factor that is being forgotten by many of these generous individuals: the multiple car discount.
Though some people do find that maintaining only one vehicle means that the price that they pay for coverage every six months or every year will drop, others are shocked to see that they actually pay slightly more because their discount has been removed. This can be difficult to understand – and to explain – for both the policyholder and the agent, for that matter.
It is also important to consider the new driver of the older car. Many parents feel that it is a good idea to give their older vehicle to their teen son or daughter who has just received his or her license. The older car might also save you some money when it comes to a driver that has a ticket and/or an accident on their record. Within this circumstance, you are now contemplating donating your older car and replacing it with a newer car for your higher rated driver, your auto insurance rates will be affected. It is very important to consult with an agent before making this decision. Otherwise, premiums could skyrocket.
On the positive side, donating a car in California also comes with some potential benefits that include helping someone in need, possible tax credits, and the ease of getting rid of an unwanted vehicle. These advantages could certainly make the activity more than worthwhile.