Finding the best auto insurance means getting the best coverage at the lowest rate. Insurance companies will take into consideration your age, where you live, and the vehicle you are insuring to determine your rates. However, you may find that four insurance companies give you vastly different quotes.Each car insurance company has a unique formula they use to evaluate customers and determine their rates. For example, while one insurer may view where you live as being a major factor in determining your car insurance premium, another might put more weight on your driving record.Agents typically won’t tell you what factors are weighted heavier than others. Therefore, you have to shop around to find the insurer that fits your needs - and your budget. After all, you could spend years driving safely and overpaying on insurance. Even if you already have auto insurance, it’s always a good idea to check up on the rates you are paying. This is particularly true if you had a significant life change recently that could influence your rates.
If you drive a vehicle, you need to carry insurance. Even if you don’t own a car, you may still need car insurance if you drive. Here’s how to find the best auto insurance to fit your needs.
Determine how much coverage you need. The law determines the minimum liability coverage that you need to carry. Because there are some differences between the states, it pays to know precisely what you need to find the best car insurance.
When reviewing your auto insurance, be aware that some types of coverage are optional. Examples include comprehensive and collision as well as non-insured driver coverages. If you are driving an older car that doesn’t hold a great deal of value, you may not need as much coverage. On the other hand, you may want to spend a little extra on auto insurance coverage for the new car that you drove off the lot just a year ago.
Consider your budget. Think through your overall financial health. If you keep some money in savings for a rainy day, you might do well with a higher deductible. Doing so translates into lower monthly premiums. But if a $1,000 bill would break the bank, choose a lower deductible even though it increases what you spend each month or every six months.
Compare auto insurance companies. Review the insurer before signing on the dotted line. Know what to look for in a car insurance company. For example, you want around-the-clock access to someone if there is an accident. Similarly, it would help if you had quick turnaround times of claims.
Online reviews can give you an excellent feel for what it is like dealing with an auto insurer when you need the company. Besides that, look for the little extras such as accident forgiveness and bonuses for good driving, good grades, or excellent credit.
Consider carefully how much insurance you have to buy. Keep your coverage options the same as you compare insurance quotes. Doing so enables you to compare apples to apples when agents offer quotes.
For starters, know what the minimum coverage in your state is. The law determines these coverage minimums, and they vary across states. For example, in Florida, you need to carry $10,000 of bodily injury coverage per person; $20,000 per accident; and $10,000 property damage per incident. Meanwhile, in California, the minimum coverage is $15,000 of bodily injury coverage per person; $30,000 per accident; and $5,000 property damage per incident. Your local Department of Motor Vehicles can give you this information if you are not sure.
Keep in mind that these are the bare minimum amounts that you’re required to have. They may not make sense for your unique situation. For instance, if you have a new car that is financed or you spend a lot of time on the road, you may need more coverage. Even just a mid-speed rear-end accident can result in quite a bit of damage to your car, so it may be a good idea to boost your insurance coverage.
What’s more, you can decrease your personal liability in the case of an accident.
For example, increasing bodily injury rates to $100,000 per person and $300,000 per accident with $100,000 in property damage might protect you better if you hit a luxury car and take out a traffic light in the process. Sure, it also costs more. But this added protection can be worth it.
Next, think through the deductible you want. If you have the funds available to pay toward repairs, choosing a higher deductible is an excellent option to reduce your premium.
Here are some additional car insurance coverage options to consider:
Collision insurance. This coverage pays for the damage your car sustains. If the other driver has insufficient liability insurance, you can tap your collision coverage. It also comes into play if you hit a tree or something that might be in the middle of the road.
Comprehensive coverage. If someone steals your car, comprehensive covers you. The same goes for floods, hail damage, falling things, and similar items. If you live in an area where deer routinely cross the roads, comprehensive pays if you hit one of them. Read your policy carefully. In many cases, this option also covers acts of vandalism.
Personal injury protection. Depending on the limitations of the coverage, personal injury protection covers your medical costs. It may also pay you for lost wages. It could be an excellent addition if you don’t have good health insurance coverage or want to double-up.
Uninsured motorist coverage. Not everyone follows the law. If you get into an accident with a driver who does not have liability coverage, an uninsured motorist add-on protects you. In some cases, it might also come into play if the other driver doesn’t have enough coverage.
Gap insurance. Cover the difference between what an insurer says your car is worth and how much you owe on it. If you get into an accident that leaves your vehicle a total loss, you do not want to continue paying on it to meet your financial obligation to the lender. This is an excellent choice when you buy a new vehicle.
One of the most common car insurance discounts is a multi-vehicle discount. If you own more than one car and insure them with the same company, you will typically receive a discount on your annual premium. Depending on the policy you are thinking of buying – and the insurer you are working with – the discount can be as much as 25%.
However, there are other discounts that you might not know about. Not all companies offer the same discounts, and many companies don’t even advertise them. Moreover, those that do may not offer them in all states. Therefore, it makes sense to ask about these potential savings.
Military discount. Some companies offer discounts for active military personnel. Others extend this benefit to family members as well. You might also qualify for a military discount if you retired or were honorably discharged. Ask ahead of time if the company offers these savings and if you have to buy a specific policy to qualify for it.
Mature drivers. Different companies define maturity differently. For many, the mature driver requirement is age 55 and older. By taking into consideration the length of time that you have spent behind the wheel, the insurer determines that you might be a safe risk. However, some companies will ask that you take a company-sponsored or approved improvement course that is targeted toward motorists in your age group.
Teen drivers. Insurance rates for teenagers are notoriously high. Companies understand that this demographic, statistically, has the highest rates of vehicle accidents. However, you may be able to save money by taking a driving course with an approved agency. Granted, this may be a minimal discount. But every penny you save is one that you can spend on something else.
Low-mileage driver. The typical insurance policy specifies that you drive the car for pleasure, to school, or to work. This is a way of removing drivers who spend more time on the road and could, therefore, be at a higher risk of getting into an accident. Examples of who may not qualify for a low-mileage driver discount include ride share drivers and those who have to drive to a neighboring city or state for work. Be mindful that most insurers will ask for an odometer reading verification to track your mileage.
Good students. Students can also save money on their auto insurance by keeping their grades up. Solid “A” or “B” grades in college will go a long way toward keeping your premiums low. Keep up the good grades to continue receiving this discount at each renewal. You may have to provide a copy of your transcript for proof.
Multiple policies. You can save a lot of money if you bundle multiple insurance policies. For example, if you buy home insurance, life insurance, and auto insurance from the same company, the insurer typically gives you a hefty discount. Verify that you receive this discount on each policy. Compare quotes to get the best deal.
Professional discounts. In some cases, members of specific professions may receive a small discount. Examples could include teachers or first responders. Every insurer has different requirements for various professions. In other words, a home-schooling parent might be able to ask for the teacher discount if the company offers it.
Auto insurance rates are determined by several factors. See which ones are making your car insurance so expensive.
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Many of the top auto insurance companies are also the largest making them household names as well. Getting insurance from an established, national company puts financial security and customer service in your corner. When looking for auto insurance, check out these 10 providers.
AARP
AAA
Progressive
GEICO
USAA
Travelers
Direct
Allstate
Nationwide
State Farm
The Hartford underwrites the AARP auto insurance program. You should be a member of the organization, which means that you are “of a certain age.” The underwriter leverages your years of driving experience to provide you with a favorable rate quote. If you qualify, you receive a 12-month premium lock and might also benefit from a disappearing deductible and first-accident forgiveness. Keep in mind that you may have to sign up for a specific type of policy to receive all the benefits. Most importantly, there may be some state limitations on benefits.
Look for discounts for specific professionals as well as loyalty after staying with AAA for a year. Students like AAA because they offers good-student discounts on specific policies. Also, you can save if you do not drive a lot. Soon-to-be drivers should check in with an agent to find out about approved driving courses that will shave a percentage off a first policy.
Any consumer can apply for coverage through Progressive. They offer several typical discounts that you will find from other providers. However, there are additional savings you may not be aware of. For example, you can get a discount if you ask for an online quote. Another one could apply if you complete the purchase of the policy online. Progressive may also give you a discount for the time you spent with another insurer if you can prove a long-lived policy without gaps in coverage. You need to ask for this discount and request information about the savings that could apply to the policy you are considering.
GEICO's marketing department has worked overtime making their advertising memorable. However, few applicants for coverage know that having a newer car or operating specific types of vehicle equipment could net them substantial discounts. For example, you might save money if you have anti-lock brakes, daytime running lights, or full front seat airbags. GEICO also offers exclusive deals to federal government employees.
Members of the military and their families may join USAA. The company offers a variety of financial products that also includes vehicle insurance. Some of the discounts you might receive are geared specifically toward military personnel. For example, you can save money if you garage your vehicle on base. In addition, the company offers deep discounts on insuring cars that you might be storing for the foreseeable future. This makes USAA an excellent choice for someone who will be going overseas for a while.
Another popular insurer, Travelers offers some unique auto insurance discounts. For example, you can receive a discount if you own your own home. You qualify for these savings even if you choose to insure the residence with another company. Another discount is the electric vehicle saving. This one applies to electric cars as well as hybrids that you own or lease. You might even save a little if you request a quote well before your current policy expires.
The Direct General Group offers life, health, and car insurance policies. Coverage is open to anyone. This company offers a variety of discounts that run the gamut from military savings for active service members to a safe driver discount for anyone who has been accident-free for the last three years. In addition, you may qualify for a discount if you are a former policyholder who is returning to do business with the company.
Allstate offers a broad range of policies from the bare bones legally required coverages to those that have some extras added for more protection. Moreover, the insurer provides the standard set of discounts that you might expect from a large, nationwide company. The most significant savings package is for those who would qualify for a safe driver discount. If you can meet the company’s parameters for this discount, you might be able to tack on other discounts as well.
With Nationwide, you might qualify for significant discounts if you agree to install the SmartRide device that plugs into your vehicle’s port. The SmartRide analyzes driving behavior and gauges your actions while operating the vehicle. Another advantage is the vanishing deductible. Each year that you drive without an accident, you get money off your deductible. After a few years of safe driving, you may not have any deductible left.
State Farm offers most of the same policies and discounts that their competitors advertise. It is noteworthy that the company offers to track your driving behavior with the Drive Safe & Save app you would have to download to your smartphone or OnStar system. Similarly, younger drivers can save if they were accident-free for three years. Another popular discount is the “student away at school” discount that applies when one driver only uses a vehicle while home on vacation.
With the help of consumers, J.D. Power has ranked major insurers by region. The regions are: California, Central, Florida, Mid-Atlantic, New England, New York, North Central, Northwest, Southeast, Southwest, and Texas. Who is making the cut in the various regions?
In California, Ameriprise made it to the top of the list. It is famous for offering a garaging discount to vehicle owners who park their cars in a garage overnight.
For the Central Region, Shelter Insurance earned a top rating. It offers a 12% discount if you pay the policy in full rather than making monthly payments.
Florida drivers favored MetLife, which also offers discounts based on where you work.
In the Mid-Atlantic Region, Erie Insurance impresses consumers and offers first accident forgiveness.
For New England, drivers voted for Amica Mutual, which features an attractive legacy discount for drivers under the age of 30 whose parents have been loyal customers for five years.
New York drivers put New York Central Mutual ahead of the curve; this company offers roadside assistance.
Drivers in the North Central Region liked doing business with Auto-Owners Insurance, which offers special policies for classic cars and converted vehicles.
For Northwest motorists, PEMCO Insurance with its rideshare option stood out.
In the Southeast, the Farm Bureau Insurance – Tennessee offers vehicle insurance as well as consumer savings on popular products and services.
Southwest drivers chose the CSAA Insurance Group with all the standard discounts whereas Texas motorists picked the Texas Farm Bureau that offers specific member discounts.
When comparing auto insurers, it can be difficult to decide who to get insurance from. It can help to ask your friends and family who they have auto insurance with to get the process started. Some companies are more attractive for niche consumers like military members or seniors. Meanwhile, others may offer more or unique discounts that could result in significant savings.
A low rate is an important factor to look at when comparing auto insurance companies. But what other things should you consider? For instance, offering strong customer service is what keeps many consumers loyal. Lastly, consider quotes from smaller or regional auto insurance providers.
In the past, buying auto insurance meant setting up an appointment with an agent in person. Or, at the very least, having to pick up the phone and talk to an agent. You can still do that if you like. However, an increasing number of consumers now prefer to get a quote at their convenience, which means shopping for insurance online.Before you do so, however, get your information together.
ID information. The insurer wants to know your address, ZIP code, and driver’s license number. You need this information for all licensed drivers in your home even if they have coverage elsewhere. Some companies will run a credit check on you. It pays to know what your score is.
Insurance details. If you currently have insurance, have the details handy. You should have the company’s name, policy number, length of time you have been there, and coverage limits.
Driving history. The insurer will pull your driving history. However, for the sake of a quote, you should be ready to disclose any moving violations and tickets you received in the last five years. This typically does not include the average parking ticket – unless you have a lot of them. Also, if you completed any driving safety courses at this time, be sure to have information on these.
Vehicle details. You need the VIN, current odometer reading, and basic make and model details. Find out what safety features are on the car. Your bill of sale or owner’s manual should give you this information.
Next, read through the list of discounts to see if there are some that you might qualify for. You may have to ask for them. That said, some insurers are good about asking for details about your background and will try to see if you can fit into these categories.
Remember, a couple of insurers offer discounts for consumers who complete a policy application online. When you sign on the dotted line, this discount would add to others you qualify for.
Once you know what your current auto insurance policy includes, think about whether there are other coverages you need or would like to have. Do you have a new driver in the house that will be using your car? Are you interested in a usage-based program to save money?When you get your quotes back, be sure to review the coverages carefully. Don’t just look at the premium. Review what discounts each provider applied, and be sure to ask about any you don’t see and could be eligible for.
Get an auto insurance quoteThe good news is that you can switch car insurance companies anytime. If you realize that you made a mistake during the purchase of the initial policy, you might want to make a change. Other reasons to consider switching include dissatisfaction with customer service, an unwillingness to go to the repair shops the insurer specifies, or bigger savings at another company.
A survey from insuranceQuotes recently found that 39% of U.S. policyholders have never shopped their auto insurance for a better rate. Consumers should periodically solicit quotes to see if they could do better than their current policy. Doing so is particularly advantageous if you have an excellent driving record or you recently had some changes in your household that could make you eligible for more discounts.
Once you decide to shop around for auto insurance, do not quit your policy until you have a new one in place. Otherwise, even a brief gap in coverage could count against you. Moreover, be clear about what your new policy covers. Confirm that you receive the same level of insurance as you do with the current company unless you are looking for a change. Once the change is final, let your auto loan company or leasing firm know.
Are you ready to shop around? Compare auto insurance quotes and start saving money.