Where do you even start? Fortunately, the internet has made it so easy that even monkeys, toddlers, or your Uncle Dan could do it if they were shown how. Thus, if you’re like us and Uncle Dan and need to be shown, well, then…
We can do that! Read on to learn how to shop for car insurance.
What Factors Affect My Insurance Premiums?
- Your age
- Your gender
- Your marital status
- Your occupation
- Your car’s make, model, and year
- Your credit history
- Your claim history
- Your driving record
- Where your car is primarily parked overnight
- What kind of safety devices are installed in your car
This list is not exhaustive; however, if you know the factors that affect your insurance premiums, you’ll have a better idea of what you should be charged before you start your search. For example, if you’re a teen male with a history of accidents and violations, you should not be surprised to find that you must pay more for insurance!
What Types of Coverages Do I Need?
You must purchase the minimum amount of your state's required insurance coverage—often liability coverage. However, this is only the beginning. You can always opt to pay more for higher limits than your state requires, and you can opt to add additional coverages like collision and/or comprehensive insurance. The amount and type of insurance you buy depends on many factors, but in the end, only you can decide how much of what type of coverage you need to protect your assets.
Can I Find Discounts on Car Insurance?
You betcha. There are several types of discounts on car insurance, including:
- Good driver discounts for keeping a clean (accident- and violation-free) driving record
- Good student discounts, for having good grades in school (usually a B average or higher)
- Discounts for taking defensive driving or driver’s ed
- Bundling discounts, for having multiple policies with one company
- Multiple-vehicle discounts, for having multiple cars under one policy
- Loyalty/new customer discounts, for new or long-time customers
- Safe car discounts, for having anti-theft and safety equipment installed in your car
You can also opt for a higher deductible (provided you can afford it) for lower monthly payments1
Comparison Shop by Getting Quotes
Once you know how much of each type of insurance you want, you can quickly and easily obtain quotes from different insurance companies online. There are often free quote calculators that will spit out fairly accurate estimates in just a few minutes after you’ve entered your information. However, for the best and most accurate deals, shop around, and talk to agents and brokers. Always compare at least three quotes! Also, be aware that you will need to share information about yourself (including your SSN) and your car in order to receive (accurate) quotes!
Choose Your Carrier
Even if you find an inexpensive policy that seems to cover what you need it to cover, we beg you to consider the insurance company itself before signing any papers. Sometimes cheap insurance comes from disorganized companies used to finding ways to get out of fair settlements for claims. Don’t let this be you! Talk to friends and family about their experiences with different companies, compare the financial standings of companies with J. D. Power and A. M. Best ratings, and look at consumer reviews and complaint ratios on your state’s insurance department website. Also, consider the Better Business Bureau ratings. Your policy may sound good, but first make sure your company has a history of making good on its promises!
Evaluate Your Policy Documents
Be sure to preview your policy contract to ensure that the right amounts of the right coverages are included on paper. Everything should look the way you saw it online or discussed it with your insurance agent. Only you can determine if it’s not by reading ALL the fine print carefully! Ask your spouse or a trusted friend to review the document with you, then ask your insurance agent about any confusing elements.
Purchase Your Policy and Obtain Proof of Insurance
Don’t worry about actually purchasing insurance. Companies make this process unbelievably easy. You will likely see a place to sign and pay the moment you click on an insurance website, or you’ll be prompted to pay for a policy as soon as you contact an agent. However, after you’ve chosen, reviewed, and purchased your policy, be sure that you obtain a copy of your proof of insurance to keep in the car. This is often in the form of an insurance card that you can either print out or expect your company to mail to you. You should keep this card with you in the glovebox or in a safe place in your car at all times!
For any questions or concerns about state requirements for insurance, talk to your insurance agent or a representative at your local DMV!