Can you remember the last time you shopped around for car insurance?
It’s easy to stay loyal to one insurer and never think about car insurance again. But the only way to ensure you’re not paying more than you have to is to see what other companies are offering.
There’s potential for you to save quite a bit of money on your premiums, so here are some tips on how to shop for car insurance.
How to shop for car insurance
Don’t worry if you haven’t shopped around for car insurance in a long time. You aren’t alone.
According to a study done by NerdWallet, 38 percent of Americans haven’t checked the price of their car insurance or compared prices in at least three years.
The study also showed that on average drivers are missing out on $416.52 of savings by not comparing quotes.
It can seem like a daunting task to take on, but getting multiple quotes from different insurance companies can only benefit you.
Prices can vastly vary between insurance companies. Shopping around ensures that you are getting the best rate possible and that you aren’t overpaying.
1. How and where to start
There are a number of ways you can shop for insurance. Each method differs in how long it takes to get car insurance.
You can meet agents in person, talk to them over the phone, fill out questionnaires on websites, or download an app.
If you value your time above everything else, the quickest way to comparing quotes is to do your research online.
It usually doesn’t take more than 10-15 minutes to fill out your information on each insurance company’s website. This way, you can easily compare prices and policy features on your own time and at your own pace.
If you’re looking to do your shopping with your phone, you can download Cover for free from the App Store and GooglePlay.
It will do the work of shopping around for you. We search over 30 insurance companies and send you the best quote at the coverage you want in the app and in SMS.
2. What you need to shop for car insurance
When you’re shopping for car insurance, the easiest way to make the process go as smoothly as possible is to have all your information handy.
To get a quote, you’ll need to know:
- The make, model, and year of your car
- Drivers license number
- Vehicle Identification Number (VIN)
- Social Security Number
- How long you’ve had the vehicle
- Your car’s mileage reading
3. Deciding on the coverages you want
There are many factors affect your quote, but one of them is coverage.
You should get multiple quotes with different coverage levels. For example, see the difference in cost between adding comprehensive or collision to your policy. Or the price difference when you decide to add both.
You should also take this time to reconsider the coverages you’re already paying for. You might be paying for coverages that you don’t need.
For example, you can drop coverages on an older vehicle. The older your car gets, the lower its value becomes. That means that the payout you’d get from filing a comprehensive or collision claim drops because of how old your car is.
If you’re driving an older vehicle (10 years or older), you might want to drop full coverage and go for a liability-only policy.
However, you should never sacrifice coverage just to save money. You never want to be underinsured. You’ll face some trouble down the line if you get into an accident and you might have to pay for damages or medical expenses out of pocket.
4. Settling on the right deductible for you
The higher your deductible, the lower your premium.
The key to settling on the right number is to find out what works best for you. If you want to save money, it makes sense that you’d want to pay the highest deductible you can to get the lowest premium.
Find a number for the deductible that you can comfortably pay if you were to file a claim. Once you settle on that number, squirrel away money in an emergency fund dedicated to paying for that deductible.
5. Setting coverage limits
Most states have minimum coverage requirements for different policies. When it comes to deciding coverage limits, never purchase just the minimum required to drive legally.
You’re the one on the hook when any kind of costs exceed your coverage limits. A good rule of thumb is to make sure you’re covered for an amount that’s equal to the total value of your assets.
6. Factor in any discounts you could be eligible for
There’s potential for you to save even more on car insurance with discounts. Discounts range from customer loyalty, driving training, car equipment, and driving history.
For car equipment, you could qualify for a discount if you’ve installed anti-theft devices in your vehicle.
You can seek out the good student discount if you’re a full-time student. The discount is usually given out if you maintain a 4.0 GPA, but that’s not always the case. The definition of a “good student” varies among insurance companies.
If you’ve graduated and have a full-time job, you could qualify for a discount if you get car insurance through your employer. Additionally, being affiliated with alumni and professional groups might earn you a discount as well.
One of the easiest discounts is the one that comes with bundling your insurance. Insurance companies often offer savings if you buy one or more policies with them. A common pair would be a home and auto insurance bundle.
Another discount to look into is the good driver discount. Most insurance companies offer this discount and give it to drivers who have been accident and traffic violation free for a certain number of years.
Discounts are something to bring up while you’re getting multiple quotes because it could make a difference in your rate.
7. Research the companies
Don’t just rely on the numbers.
Do your research when it comes to these insurance companies. Look into online reviews and find out what customers are saying about these insurers.
Customer service might not be high on your list of priorities, but it could mean a lot if you ever need to file a claim or if you have questions about your policy.
8. Don’t ignore local and regional companies
If you can, try and get quotes from some local or regional insurance companies. It might be worthwhile checking out since they could offer a lower rate for the coverage that you want.
These smaller insurers often have higher customer satisfaction ratings than the bigger companies. If that’s important to you, do your research to see which local insurers can get you a rate.
Switching car insurance companies
Once you’ve gotten your quotes, most of the hard work is done. You just need to make the final decision on which one works the best for you.
Switching car insurance companies is fairly easy. You just need to contact your insurance company to give them written notice that you’re canceling your current policy.
Just make sure that you’ve purchased your new policy before canceling your car insurance. You never want to have a lapse in coverage or be caught driving without insurance. This can have severe consequences even if you’re uninsured for one day.
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