Impact of earthquake in Japan on auto insurance

Many drivers have read about the anticipated increase in automobile prices.

Online PR News – 23-March-2011 – – Many drivers have read about the anticipated increase in automobile prices because of the shortage of components caused by production disruption in factories in Japan that were damaged by the recent earthquake.

These components are used by Japanese car manufacturers as well as domestic car makers like GM. Even GM trucks manufactured in the US contain components made in Japan. There will also be a shortage of parts needed to repair cars already on the road and this is expected to result in a short term increase in the cost of some parts.

What little good news for drivers is these increases should not impact insurance prices, that is not unless the supply disruption continues for a long time. Purchasing a new car generally means higher insurance rates simply because of the higher value of a new car compared with an older car.

If drivers want to reduce the cost of their insurance they should opt for older model vehicles and consider liability only rather than full coverage. Liability only will allow the owner of the car to comply with the law but will not provide repairs to the vehicle if the vehicle is damage in an accident.

Active Insurance Agency sells Liability Plus which allows the car owner to comply with the law and fixes the car if an uninsured motorist is at fault in a collision, according to Cindy Garcia, Marketing Director.

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