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5 questions to ask your car insurance agent

What's inside your car insurance policy?

Asking the right questions when you get car insurance quotes can save you money and frustration.

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For one reason or another, your agent may not always discuss your policy in excruciating detail. They assume you'll read it. But if you're like most people, you'll park it in your filing cabinet and forget about it. We asked insurance agents across the country to give us their tips. Here's what they said customers should ask their insurance agents, but often don't.

1: Am I getting all the auto insurance discounts that my company offers?

Many car insurance companies offer much more than safe-driver discounts. You may qualify for a variety of other discounts, called "credits." Derek S. Ross, vice president of C.M. Meiers Company Inc., an insurance brokerage in Woodland Hills, Calif., says insurers offer discounts if your car has certain safety features like a car alarm, airbags or an antitheft or electronic vehicle-locator device. Your insurer may even give you a discount if you park in a garage.

If you drive a hybrid, some insurers offer discounts simply because the vehicle is eco-friendly.

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Bragging about your child's accomplishments in school could save you up to 20 percent on your insurance policy: Ask for a good student discount (most companies require a 3.0 GPA or higher). This generally applies to young adults in their teens to age 23 or 25.

Some insurers also offer discounts to working professionals. "They all create their own discount structures for select professionals and groups," Ross says. This applies to customers who have a master's or doctorate degree (like medical professionals, lawyers, engineers and others).

In addition, being a member of a professional organization within your field — like a state bar association or medical board — can save you insurance money, Ross says. Some insurers even offer discounts if you graduated from a specific college or university. Just ask. Other discounts include low-mileage savings. If you don't drive long distances, some companies will award you a discount based on your annual mileage. Finally, if you happen to have a homeowners insurance policy with the same company, don't forget to ask for a multiline discount.

2: Do I have comprehensive and collision coverage — and is it worth it?

Collision coverage pays for repairs to your car in the event of an accident, no matter who caused it. Comprehensive coverage pays for damage suffered through other events — like vandalism, flood, theft or tree damage. Both coverages generally require that you pay a deductible first.

Alex Soto, former chairman of the Independent Insurance Agents & Brokers of America and current president and CEO of Miami-based InSource Inc., says that collision and comprehensive coverage can be a good idea if you own a newer car. But once your car depreciates in value, you may want to cancel it. For example, it may not be worthwhile to pay $400 a year for collision/comprehensive insurance to protect a car that is only valued at $3,000. If you make a total loss claim, you'll pay your deductible (say, $1,000) and the insurance company then pays the remainder -- in this case, $2,000. Was that $400 premium worth it?

On the other hand, if your car is valued at $40,000, buying comprehensive and collision coverage for $500 to $600 may be a good idea. "It is worth it because while you can afford a $2,000 loss as in the previous example, you may not wish to self-insure $40,000," Soto says. Check the NADA Guides' value of your car each year and decide if collision and comprehensive coverage is a good bet.

3: Does my policy include uninsured/underinsured motorist (UM/UIM) coverage

Not all states require you to have UM coverage. (See your state’s minimum levels of required auto insurance.) If you must buy it, your agent will tell you. If not, Ross says it's one of the most important coverages to consider. If you have collision coverage, damages to your vehicle will be covered if an uninsured driver crashes into you. But if you don't, you may want to consider purchasing uninsured motorist property-damage (UMPD) coverage. "A lot of people cannot afford comp and collision," Ross says. "So if you don't have it because you can't afford it, you can get UMPD."

Because it's less expensive than collision, UMPD usually only pays up to $3,500 for repairs but it does not require you to cough up a deductible. If you do have collision coverage — and want to avoid paying the deductible (usually at least $500) after an accident — you can add on a collision deductible waiver. Relatively inexpensive, this will waive your collision deductible if your vehicle is hit by an uninsured motorist.

You should also ask your agent what type of coverage you have in the event an uninsured driver hits your vehicle and injures you. While collision coverage pays for damages to your vehicle, it does not cover medical bills. You may want to inquire about UM coverage for bodily injury.

You'll get actual cash value for your totaled car

4: If my car is totaled, how much will my insurance pay to cover the loss?

If you don't address the issue when you buy your policy, the claims check to pay for your totaled car may shock you. Mary Paquette, vice president of private client services at Chartwell Insurance Services in Chicago, says that some insurance companies pay out "actual cash value" while others pay an "agreed upon value" in the event of a total loss. Actual cash value is the depreciated value of your car at the time of the loss. Many insurance companies use the NADA Guide to look up this figure, Paquette says.

For example, say you insure your new car valued at $20,000 in January. With an actual cash value policy, your car may only be valued at $16,000 in July, Paquette says. That's what you would be paid for your wrecked car. "It can be a surprise," Paquette says. But if your policy has an "agreed upon value," the total loss value of your car (agreed upon annually when you renew your insurance) does not drop during the term of your policy.

"This way you have the piece of mind of knowing exactly what that value is listed at and sometimes you have the flexibility to increase that agreed value for an additional premium," says Paquette, adding that certain companies such as Chubb Group, Fireman's Fund and Chartis Private Client Group offer "agreed upon value." Check with your agent to see if your insurer offers that option. Adding the feature to your policy will cost around $100 extra for the average policyholder, she says.

For more, here’s what to do when your auto insurer totals your car.

5: If I need new parts for my car, will my insurer pay for original manufacturer parts?

Some insurance companies guarantee "original equipment manufacturer" (OEM) parts while others will pay only for "aftermarket parts," Paquette says. As the name suggests, OEM parts are those made by the manufacturer of your vehicle. "Aftermarket parts" are generally less expensive and made by another manufacturer (commonly foreign manufacturers).

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"To some people it really doesn't matter, but to some people it does. These are just good things to know," she says.

Many insurance companies also retain the right to use either one. For example, when it comes to safety items that include airbags and engine parts, some insurers will guarantee OEM parts. But if you need to replace nonsafety items such as a stereo, power windows and door knobs, you may get aftermarket parts. This may not always be negotiable with some insurers. Some insurance companies will not write policies that guarantee OEM parts. Of course you can always choose to pay the extra cost for OEMs if you're in an accident. "But if you have an option between companies, you may want to go with a company that does not retain the right to use aftermarket parts," Paquette says.

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