Auto insurance is something that most of us only choose to shop for maybe once every year or two. Usually, we do so either when buying a car or when we see a TV commercial and decide that it may be time to compare rates from different insurance companies.
When looking for the best deal on car insurance, it is a good idea to not only to consider quotes from multiple companies: you should also look at this as the perfect opportunity to review whether the coverage that your current policy has is adequate, insufficient, or overkill.
Comparing auto insurance rates, of course, is only possible when you are able to compare apples-to-apples (comparable) quotes from multiple companies. In order to do this, it is a smart idea to start by carefully examining your coverage needs - both the required and optional ones.
If you want to make auto insurance rate comparisons to find the best rates, here are 5 guidelines that can help save you money:
1. Find out your state or municipality's minimum coverage requirements:
The state, province, or county in which you live has likely established some guidelines or requirements concerning the minimum coverage you need to buy in order to drive legally. In most cases, this comes in the form of liability insurance.
Liability insurance is the type of insurance coverage that pays for the other party's medical bills and property damage should you be the one to cause an accident. Coverage limits are usually quoted at a per accident/per person rate. Check for the limits in your area to be sure you are buying at least the minimum-required amount.
2. Understand the various types of coverage available to you:
In addition to liability insurance, you should probably purchase other types of insurance. Namely, consider buying collision coverage (covers your property if it is your fault), medical payments coverage (covers your medical expenses if it is your fault), and uninsured motorist insurance (covers your medical and property expenses if it is their fault and they are uninsured).
3. Choose appropriate coverage limits:
As mentioned above, coverage limits in policies are usually stated in terms of per accident/per person. For example, coverage limits for medical payment coverage for a give policy may be stated as: $300,000/$150,000. Make sure you do not just buy the minimum coverage limits unless that is truly all you can afford. Otherwise, you could end up either inadequately covered yourself or being sued by the other party (if the accident is your fault) for inadequately covering them.
4. Create a list of at least 3-4 insurers:
Now that you have an idea for your desired coverage types and limits, it is time to create a list of 3-4 insurers. Do research to look for insurers that advertise themselves as low-rate auto insurers.
5. Shop around by getting apples-to-apples quotes:
As you shop around, be sure to ask for identical policies in terms of coverage types and limits so that you can easily compare quotes.
Consider these 5 tips as you conduct an auto insurance rate comparison.