805-238-1818

Auto Insurance Risk and Car Buying

Auto Insurance and car buying what is the risk? What I am talking about today is parents and kids going car shopping. They look at several different makes and models. The car salesman has them set to go with the paperwork. No comes the potential mistake, the risk. We don't have the cash to buy the car and mom and dad have much better credit than the kid. Well we want the best finance rate don't we. Sure we will co sign the note. We can build juniors credit and save some finance charges. Seems safe, right?  Well here is the risk, by co-signing the loan mom and dads name are put on the title to the car. That means that where ever the car is driven mom and dads assets go with it. We have run into situations where the kid is insuring the car themselves and chose lower limits of liability to keep the costs down and only find out upon looking at the registration that some one else has assets at risk. The fix to this situation is to make sure the car has the same limit of liability as all the rest of the family cars. A step down in liability could open up problems in event of a large claim. We at Ted Hamm Insurance do our best to keep everything balanced, risk versus reward as it were. I want to help my kids but as they are no longer in the household, I don't want their accident to be mine. Just a thought if you are helping a college age child in the car buying process. Make the purchase a safe one for both of you. Any questions please call us at 805-238-1818

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