How to Shop for Car Insurance
Shopping for insurance has never been easier. Thanks to several Internet resources, you can shop for car insurance quotes anytime, anywhere, and get multiple quotes from different insurers simultaneously. Of course, you can still meet face-to-face or consult over the phone with insurance agents to discuss your options, or even search through the phone book or newspaper for local companies. However you go about it, it’s important that you consider your options, as quotes – and coverages – will vary by company.
“First thing’s first, you need to shop around,” said Mike Barry, spokesman for the Insurance Information Institute (III). “In most states, it’s a very competitive market, and there are many companies out there that want your business.”
By shopping around for quotes on car insurance, you can find the best rate from a reputable company that also provides the coverages you need.
Where to Look for Insurance Providers
These resources can provide you with a number of providers with little work. And, best of all, they won’t cost you a dime:
You can get free car insurance quotes online from a number of different companies through sites such as ours, Insweb.com, Quicken Insurance, and NetQuote. You simply put in your driver information, vehicle details, and the coverages and limits you want, and you can compare car insurance quotes online in minutes.
If you prefer talking to a real-live person, you can speak directly to an insurance agent or broker. Captive insurance agents work exclusively for one insurance company, while independent agents deal with multiple companies to shop around your insurance needs. There are also direct writers – insurance companies like GIECO and Progressive that don’t have agents to sell policies, but employees who service your policies.
State Insurance Department.
Your state’s insurance department will often provide information on licensed auto insurers, including a mix of national and local companies, on its website. Your state might publish premium comparisons, too.
Your home insurance provider.
Oftentimes, insurance companies will offer you discounts if you get another policy with them. So if you already have a home insurance policy, you should see if your insurer also provides car insurance, and, if so, if you can get any discounts.
Your friends and family can be valuable resources for insurance company or agent recommendations by asking them who they have and what their claim experience has been like.
The III recommends getting at three quotes from companies, agents, and the Internet.
What to Look for in Insurance Providers
Finding the cheapest quote available is nice, but you’ll also want to find a company that is reputable. Here’s what to look for so you know you’re getting a quality policy that, when the time comes, will provide you with the financial help you need:
A fancy website or business cards aren’t the signs of an established insurer. Rather, when choosing an insurance company or agent to work with, check that they are licensed to sell insurance in your state. If unlicensed, you run the risk of the insurer not paying your claims, or, if you cancel your policy, not refunding your premiums. Checking is easy – you can refer to your state insurance department to see if a company is licensed to sell insurance in your state.
An insurer’s financial standing is extremely important – if you file a claim, you’ll want the company to be able to pay you. You can check the financial stability of an insurance company through major independent rating agencies like Standard & Poor’s, A.M. Best, and Moody’s.
A compliant index is the number of complaints your state insurance department’s received on a company relative to the number of policies it has sold. In other words, it can help you determine if other customers are happy with the insurer before you commit.
The U.S. Government offers additional tips for finding reputable insurance companies, including checking that the insurer’s website is secure (such as the lock icon and a URL that begins with “https:”) and to be wary of people selling unsolicited insurance door-to-door or over the phone.
What to Ask Insurance Providers
Once you get in touch with a reputable insurance provider, getting a quote is just part of the process. You’ll also want to cover your bases and find out what exactly the policy offers. Here are some points to bring up so you can find a car insurance policy that works for you:
How much liability protection do you have? How much liability protection do you need? Does the policy include comprehensive and collision coverages? How about uninsured and underinsured coverage? You’ll want to talk to the agent or direct writer about all the different coverages the policy includes, as well as what it doesn’t.
How much will your insurance pay if you total your car? You’ll want to find out before it’s too late. The key thing to check for is how the company determines the value of your car – is it actual cash value (the depreciated value of your car at the time of the loss) or agreed-upon value (a set number that does not drop during the term of your policy).
Some insurers only cover generic replacement parts – aka aftermarket parts – as opposed to original manufacturer parts to cut claims costs. Similarly, they might encourage you to bring your car to specific body shops. But you’ll want to keep you repair options open so that you have more flexibility in which body shops replacement parts are covered.
To save money on your policy, ask about any discounts that apply to you. A main one is a safe driver discount, sometimes awarded if you’ve maintained a clean driving record, though some insurers may also offer discounts for safety features, such as car alarms or antitheft devices; if you park your car in a garage; if you drive a hybrid; if you have low-mileage; and, even, if you’re a member of a professional organization. It doesn’t hurt to ask.
Like any bill, you’ll want to find out how often payments are due, and what the penalty is if you’re late in making one.
What Insurance Providers Will Ask You
You’re not the only one doing the scrutinizing here. Insurance companies and agents will also be looking into your background and record when determining your policy. Here are the key pieces of information they’ll want to know to figure out your rates:
- The make, model, year, trim line, and vehicle identification number (VIN) of your vehicle
- The age, sex, recent driving record of all potential drivers
- Where you normally park your car
- Any accessories you may have installed to prevent theft
- Your driving and insurance history
Now Do It All Over Again
Shopping for an auto insurance policy isn’t necessarily a one-time deal. While loyalty to a car company can get you discounts in the long run, Consumer Reports recommends that you get quotes on car insurance rates at least once a year just to see if you can save money elsewhere.