Comparing
car insurance rates can be a good way to assess if you're getting the most
value for your money. When shopping for car insurance, it's important to
understand the difference between car insurances quotes and rates.
A car insurance quote is an estimate provided by an insurance company detailing how much you can expect to pay for an insurance policy.
A car insurance rate is the amount you pay for an auto insurance policy over a certain period of time. The rate is affected by the coverages you choose and some other auto-related factors, such as your driving record.
You may need to have some personal and vehicle information ready when requesting a car insurance quote. This could include your address, Social Security number, Vehicle Identification Number (VIN) and your car's mileage.
The Insurance Information Institute (III) suggests comparing at least three quotes from different auto insurance providers. Each quote you get should be based on the same set of coverages, limits and deductibles, so you can compare them side by side.
A car insurance quote is an estimate provided by an insurance company detailing how much you can expect to pay for an insurance policy.
A car insurance rate is the amount you pay for an auto insurance policy over a certain period of time. The rate is affected by the coverages you choose and some other auto-related factors, such as your driving record.
You may need to have some personal and vehicle information ready when requesting a car insurance quote. This could include your address, Social Security number, Vehicle Identification Number (VIN) and your car's mileage.
The Insurance Information Institute (III) suggests comparing at least three quotes from different auto insurance providers. Each quote you get should be based on the same set of coverages, limits and deductibles, so you can compare them side by side.
Why Compare Car Insurance Quotes?
Car insurance rates differ widely, which is why it’s important to compare quotes before buying a policy. Your rate is determined by several factors, like your age, location, driving record, level of education, and the kind of car you drive. Each insurance company weighs these uniquely, which is why the same policy may be priced differently based on where you’re getting a quote from.
The only way to make sure you get the best rate is to compare car insurance quotes from a few companies. We recommend comparing at least three quotes any time you shop. As you’ll see in a moment, car insurance premiums depend on a wide variety of factors that are unique to each driver. Based on your driver profile, what you pay for your policy is different from what your friends, family and neighbors pay for theirs.
Car insurance prices can also vary drastically between providers. By comparing multiple quotes, you’ll be able to see which insurer offers you the cheapest auto insurance. If you just get one quote, there’s no way to know if it’s a good deal.
Each company has a process for evaluating driver profiles and assigning rates. A speeding ticket may raise your annual premium cost by $500 with one provider and $1,000 with another, for example. On the other hand, one company may give you a good discount for owning a home, while another might not.
How to compare car insurance quotes
You need an auto insurance policy that covers your needs (without going overboard) and doesn’t cost an arm and a leg. Take these steps to make sure you’re getting the best deal:
1. Know your state limits
Nearly every state requires some form of auto insurance. If you drive uninsured or underinsured, you risk traffic citations, having your car towed, or even a potential loss of license depending on where you live. Know what’s required in your state before you sign up for a policy.
2. Gather your info
Finding the best deal often comes down to knowing what you need. Before you compare auto insurance policies, get to know the basics of your ride:
- Year
- Make
- Model
- Special features
- Safety features
3. Choose your coverage levels
Auto insurance isn’t one-size-fits-all. While you can tailor your policy in several ways, auto insurance breaks down into three main types:
Liability: Covers the other drivers on the road and meets most state’s legal requirements, but won’t protect you if you’re involved in an accident.
Collision: Provides protection against road accidents. If you’re involved in an accident, your insurer will cover all or part of the cost of repairing or replacing your vehicle, depending on your coverage limits.
Comprehensive: Protects you against practically everything else that can happen to your car. That includes damage from natural disasters, vandalism, and theft.
4. Decide if you need full coverage
A full coverage policy typically encompasses liability, collision, and comprehensive coverage. If you’re involved in an accident, full coverage pays for injuries and damages for both you and the other driver. You’re also covered if your car is damaged or stolen and not recovered.
Full coverage is great to have, especially for drivers who frequently park on busy streets, but not everyone needs it. If your car is an older model, typically parked in a garage, or not driven heavily, you may save money by cutting down on insurance.
Not sure what you need? The licensed insurance agents at Gabi can help you choose the perfect coverage level for you!
5. Compare
Once you have an idea of what to look for, request quotes from multiple insurance providers. Rates for the same coverage can vary widely from insurer to insurer, so it helps to compare at least three policies — and up to as many as you want.
You can compare policies by contacting insurance providers directly. For an easier way, use Gabi to compare multiple auto insurance rates and policies from nationwide providers in just a few minutes (or less).
Types of car insurance coverage
Car insurance policies aren’t one-size-fits-all. Most auto insurance policies encompass a mix of six main types of car insurance coverage, plus a few optional additions.
Vehicle liability coverage is required by law in almost every state. If a driver is involved in a car accident and found to be at fault, this type of coverage will help pay for damage to the other driver’s vehicle and any resulting medical bills for the other parties involved.
Personal injury protection, sometimes abbreviated PIP, covers you and your passengers’ medical bills and lost wages in the case of an accident. Also known as no-fault insurance, PIP will help cover these bills regardless of who is at fault in an accident.
Medical payments coverage, also known as MedPay, is usually offered in non-PIP states. MedPay is a stripped-down version of PIP that will help cover hospital bills for you and your passengers after an accident, even if you’re not in a vehicle.
Uninsured or underinsured motorist coverage kicks in when you’re the victim of a hit-and-run or when you’re involved in an accident where the at-fault driver doesn’t have enough coverage to cover your damages. This coverage is currently required in 22 states
Collision insurance covers damages if your vehicle collides with another car or object. If you’re driving a car you purchased with a car loan or other financing plan, you’ll probably be required to buy collision coverage.
Comprehensive coverage kicks in when your car is damaged in a non-collision incident. This includes incidents of vandalism, theft, weather-related damage, and other acts of God. This is typically optional but usually required by your lender if you don’t own your car outright.
Frequently Asked Question (FAQ)
How do I find the cheapest car insurance?
The simplest way to find the cheapest car insurance is to compare quotes online
How much does car insurance cost?
The average annual cost of an auto insurance policy in the United States is $136 a month; however, rates vary greatly depending on your driving history, desired coverage levels, and personal details.
How to compare auto insurance plans?
Your insurance rates are based on personal factors like age, gender, vehicle, location, credit history, driving record, and claims history. To find the best rates, compare many quotes at once using a trusted insurance comparison site.
Who is the top five insurance company?
The five largest insurance companies in the U.S. are State Farm, Allstate, USAA, Liberty Mutual, and Farmers.
How does your address affect your car insurance?
Your address is one of the many factors that insurance companies use to determine auto premiums. Changing your address can change your level of risk, so changing your address can raise or lower your rate depending on where you move. When you're getting a car insurance quote, insurers always ask for your address.
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