You should always contact your agent before entering serious talks with a dealer about purchasing a vehicle. Not only can your agent let you know in advance what to expect from your new auto premium, but we can advise you about various “enhancements” that these dealerships offer. The two most common issues I have seen recently are “debt protection packages” and “enhanced security features”. When purchasing a new car, most Americans need to rely on some sort of financing or leasing in order to afford the purchase. Unfortunately, in the event of a claim, this can leave buyers upside down on their loan; that is, owing more than the car is now worth. Auto dealers have responded by including “debt protection” plans in leasing and financing agreements, which seems like a great deal to protect yourself. Who wouldn’t want to spend an extra few hundred dollars to protect themselves from owing several thousand after a claim? You’re overpaying if you purchase this coverage from the dealership. This replacement cost coverage is available for brand new cars under most auto policies for pennies on the dollar. Dealerships can charge anywhere from $300 to $1,000 for these options to be included! Pennsylvania is one of the few states that makes it illegal for a dealership to require the purchase of this coverage as a requirement for financing.  Please note that this is not the case for leased vehicles, where dealerships are allowed to require that gap coverage be purchased as a part of the leasing agreement. Replacement cost coverage is also not available for previously owned/leased vehicles.

The “enhanced security features” is another interesting point car dealers are pushing today. Always consult with your insurance agent about the available discounts under your policy before purchasing additional features. Obviously, our concern is that you’re driving around in the safest vehicle available to you. However, if you’re considering upgrading your vehicle under the impression that a discount will be created, this may be ill-advised. The insurance industry has not yet caught up with the innovations in automotive technology; there are not yet discounts available for things like additional cameras, or accident control technology. Of course, these features reduce the likelihood of accidents and therefore indirectly help reduce your annual premium. The moral of the story is that your agent is here to help you! In order to make the best decision regarding your new vehicle, give your agent a call before you sign on the dotted line. We’re always happy to help you surprise your family with a new car, without surprising your wallet!