9. You may not owe sales tax on your replacement car. Twenty-eight states require auto insurers to pay for the sales tax when you replace your totaled vehicle with a new or used car: Alaska, Arizona, Arkansas, California, Connecticut, Florida, Georgia, Hawaii, Illinois, Indiana, Kansas, Kentucky, Maryland, Minnesota, Missouri, Nebraska, Nevada, New Jersey, New York, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Vermont, Washington, West Virginia and Wisconsin.

Tip: Make the request; don't expect the insurer to offer to pay upfront. Even in states that do not require sales-tax reimbursement, you should request it. Many auto insurers will not deny the request because the policy requires that they make you "whole," returning you to where you were before the accident at no cost to you.

10. The tax will be calculated based on the pre-accident value of your car. If the insurance company values your car at $10,000, and you purchase a new car for $20,000, the tax will be calculated on $10,000.

11. You can wait to add your teenager to your policy until he or she is licensed. You're not required to add your teenager to your policy just because he/she has reached driving age. Usually you can wait until he/she has a license or, if you're in a high-risk insurance pool, a permit.

Tip: Don't forget to tell your insurance company that you have a licensed teen. If you have to file a claim on his/her behalf, your insurer is entitled to charge you back premiums from the date your teen received a license.

12. You must officially cancel your insurance policy when you switch insurers. Your policy likely states that you can cancel by notifying the company in writing of the date of termination. Don't assume that you can terminate the policy at the end of the coverage period by simply ignoring the bill. The insurers won't see it that way. They'll send you another bill for the next premium payment, and when you don't pay it, you'll be cancelled for nonpayment. That goes on your credit record.

Tip: Call your insurance agent or company and state that you're canceling your policy. Give a specific date, or you may end up uninsured for a period of time. The company will send you a cancellation request. Often, the form is already filled out and just requires your signature. Read it to check for errors. You may have to provide proof of new coverage to your former insurer. And if you've financed through a dealership, give the dealer your new insurance information, because purchase contracts often require proof of coverage.

Page 3 of 3 :: First | Last :: Prev | 1 2 3 | Next