Buying car insurance may seem straightforward, but the process is often more complicated than many drivers realize. With so many providers, coverage options, and terms to compare, it’s easy to make decisions that cost more in the long run or leave you underinsured when it matters most. Whether you’re purchasing your first policy or reviewing your current one, being aware of common mistakes can help you make smarter choices and avoid unpleasant surprises.

One of the biggest errors people make is choosing the cheapest policy without considering what it actually covers. While saving money is appealing, a bare-bones policy often provides only the minimum protection. That means if you’re involved in an accident, you could end up paying thousands of dollars out of pocket. It’s always better to balance affordability with strong coverage that matches your needs, rather than assuming the lowest premium will be enough.

Another common mistake is not understanding the different types of coverage. Liability, collision, and comprehensive all serve different purposes, and skipping one to save money can be risky. Liability covers damage or injury you cause to others, while collision covers your own vehicle in an accident, and comprehensive protects against events like theft, vandalism, or severe weather. Knowing what each type does—and doesn’t—cover is key to protecting yourself financially.

Many drivers also rely solely on their state’s minimum coverage requirements, thinking that’s enough. Unfortunately, minimums are often far too low to cover the true cost of medical bills, property damage, or lawsuits. For example, if your policy covers $25,000 in bodily injury and the accident results in a $50,000 hospital bill, you’ll be responsible for the difference. Increasing your liability limits is one of the simplest and most effective ways to strengthen your protection.

Shopping around is another step drivers often overlook. Insurance premiums vary widely between companies, even for the same person and vehicle. By getting multiple quotes, you not only compare prices but also gain insight into customer service quality, claims handling, and available discounts. Taking the time to shop around could save hundreds of dollars each year.

Deductibles are another area where mistakes happen. A higher deductible usually lowers your monthly premium, but it also means you’ll pay more upfront in the event of a claim. Conversely, a very low deductible raises premiums unnecessarily. The key is finding a balance where your deductible is affordable but your monthly payments remain manageable.

Discounts are another commonly missed opportunity. Insurance companies often offer discounts for safe driving, bundling policies, paying annually, or adding safety features to your car. Students, seniors, and military members may qualify for even more savings. Failing to ask about discounts can leave money on the table.

For those who lease or finance their vehicles, gap insurance is another area that’s often misunderstood or ignored. If your car is totaled, your standard policy only covers its current market value, which might be less than what you owe on the loan. Gap insurance covers the difference, saving you from having to pay off a car you no longer have. Skipping this coverage can be a costly mistake.

Life changes also affect your policy, yet many people forget to update their information. Getting married, moving, or adding a teen driver can all impact your insurance needs and premiums. Failing to notify your insurer can result in gaps in coverage or higher costs later. Regularly reviewing your policy ensures it reflects your current circumstances.

Another overlooked protection is uninsured and underinsured motorist coverage. Not all drivers carry enough insurance—or any at all. If you’re hit by one of them, you may end up paying your own expenses unless you have this coverage in place. Considering how many uninsured drivers are on the road, this protection is a smart investment.

Policy reviews are also critical. Many people purchase car insurance and then forget about it for years. But rates, discounts, and your own driving record can change. An annual review allows you to find better deals, ensure you’re properly covered, and take advantage of new savings opportunities.

Rental car coverage and add-ons like roadside assistance are smaller but important details people often assume are automatically included. Some policies do extend coverage to rental cars, but others do not. Roadside assistance and towing coverage are inexpensive additions that provide valuable peace of mind, yet many skip them to save a few dollars, only to regret it later when stuck on the side of the road.

In the end, buying car insurance is not just about fulfilling a legal requirement—it’s about protecting your finances, your vehicle, and yourself. Mistakes like underinsuring, ignoring discounts, or failing to understand your policy can be costly. By taking the time to compare options, understand coverage, and update your policy as your life changes, you’ll ensure you have the protection you need at a price that makes sense.

Car insurance may seem complex, but avoiding these common mistakes puts you in a stronger position. It allows you to drive with confidence, knowing that no matter what happens on the road, you and your family are covered.