Cutting Through the BS: Deciphering Car Insurance Quotes Properly

deciphering car insurance quotes properly
In most states car insurance is one of those unavoidable expenses for drivers. However, you don’t need to pay an arm and a leg for a policy. If you’re shopping around for a policy read this handy guide to deciphering car insurance quotes properly.

Understand Your Insurance Needs First

How will you know what the perfect quote is if you don’t even understand your own car insurance needs? Regardless of your situation, here are five critical things to consider.

  1. Your state laws. With 49 states requiring you to buy liability insurance and another 12 states (along with D.C. and Puerto Rico) requiring Personal Injury Protection, you most likely already have a good amount of coverage to begin with.
  1. Explore optional coverages. How Stuff Works suggests looking at some optional coverage to see how you can best balance the coverage you’re already mandated to have, with extra add-ons to fill in the cracks. Want a backup plan in case your car’s in the shop? Throw in a rental car coverage. Have a new car you’re paying a loan on? You might want to look for gap insurance to make sure you’re covered in case the car gets totaled. Explore the full range of optional coverages offered to you some of them can really come in handy when you need them.
  1. Your budget. How much can you afford to spend? You’ll need to consider the amount of coverage required by your state’s laws, and then any additional coverage options you feel are important. Auto insurance premiums can be paid monthly, quarterly, or even annually. In fact, depending on the company, your premiums can sometimes be cheaper if you elect to pay at once as opposed to making monthly payments.
  1. Your insurance minimum. Insurance minimums are largely governed by state laws but that doesn’t mean you need to go with them. It’s always a good idea to go for as much as you can comfortably afford, especially if you have assets to protect. That way, when you get into an accident, your coverage will be more than enough to keep you from dipping into your savings or selling stuff just to pay for medical and liability costs. Take the time to play out a hypothetical accident scenario and whether the coverage amounts you’re thinking of choosing are actually enough for you.
  1. Your car. If your car is totaled, do you have the financial resources to buy a new one? If you don’t, you might want to make sure you add collision and comprehensive coverage to your policy. Shelling off $200 every year to have your car insured goes a long way to giving you the peace of mind you deserve. Of course, if you drive an old beater or something you wouldn’t want to replace, it might make more sense going for liability-only insurance.

When you finally have a solid understanding of what you need from your insurance policy, you’re ready to shop around for insurance quotes.

Now Compare Policies

When you compare quotes, it’s not just about choosing the lowest available rate. Here are six factors you’ll need to check out:

  1. The Insurance company. Before you do anything else, make sure you’re dealing with a licensed broker or representative of the company. And if you know some insurance providers you may want to switch to, then compare the information you have on those companies to help you pick the top performer from your list. An easy way to make sure you’re dealing with licensed professionals is to turn to online auto insurance quotes comparison sites like CoverHound, which uses your information to show you policies from several different carriers so you can see the full spread of options available.
  2. Cost. WikiHow recommends comparing baseline costs but cautions against letting cheap rates resolve the issue for you. As noted above, the cheapest rates typically do not equal ample protection.
  3. Inclusions. Check the coverage inclusions. One company might offer more for less. Don’t sign with the first company you like, instead explore a handful of different companies and weigh their coverage offerings against one another. Take a look at every piece of coverage included before you commit to anything.
  4. Discounts. Don’t forget to check for discounts. There’s a strong chance something about your situation can lend to a discount. Whether it’s your driving record, your car’s safety features, your level of education or even how little you plan on driving explore every nook and cranny of your situation that could result in premium savings.
  5. Customer Service. You’ve got exceptional rates and coverage. So what else is missing? Customer service. You’re going to be dealing with your insurance provider for years. If the company has a reputation for changing underwriting policies without telling its clients or have a habit of hiking up its premiums, that might not be the best insurance provider for you. You can check out sites like A.M. Best, which provide ratings on insurers in a wide variety of categories to help you make the most informed decision possible.
  6. Comfort. Do you feel comfortable with your insurance? Can you get in touch with a representative any time you need to clarify something? Then those are indications that you have a good insurance provider.

Most policy holders stay with their insurance providers for about four years, shelling out money for rising premiums without batting an eye. But by using the above tips, finding a better rate is as simple as putting forth the effort. Don’t be stuck with a subpar coverage or a questionable insurer because you basked in laziness.

Finally, if you are looking for more resources, check out this Car Insurance Guide from  Its got comprehensive answers to some harder to answer questions – such as whether you can get insurance with a suspended license and whether or not insurance companies talk to each other.

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