5 Simple Ways to Compare Auto Insurance Quotes

With many people today having the need to stick to a strict budget, it is important to analyze every part of a budget and determine if there are ways to save money. In the case of auto insurance companies, many people are discovering that there are a lot more choices available on the market, making auto insurance comparison possible. More choices have meant that a lot of people have been able to save hundreds of dollars a year on this area of their budget. Try our FREE quote comparison tool on our homepage by entering your ZIP!

Of course, more choices have also meant that people have had a much harder time picking out the insurance policy that is right for them. Getting the best auto insurance policy doesn’t always mean simply picking out the cheapest policy available. There are several factors that need to be considered when researching and buying auto insurance.

For example, many people need to carefully consider how much coverage they need. A person with a significant amount of assets will need to have more coverage than a person with very few assets. A lot of people need to consider several different aspects of a potential insurance policy before deciding on which one to purchase.

The following is a list of five different aspects of an auto insurance policy that a potential customer needs to compare across all potential policies they are considering before making a purchase. Depending on a driver’s personal circumstances, each of these factors may have different levels of importance.

1. What is covered?

In general, there are three different types of auto insurance. Basic coverage will provide only the state-mandated coverage. This means that in the event of an accident, an at-fault driver’s insurance will only pay for the damage caused to the victims’ car and health. Collision coverage will cover the damage to the at-fault driver’s automobile and also provide funds for his or her health care bills.

Finally, comprehensive insurance will cover nearly any disaster that could befall a car or truck. It will provide money in the event that the car is stolen, vandalized, or damaged during a natural disaster.

2. How much coverage is provided?

Typically, the cheapest policies will offer the least amount of coverage. This is not always the case, however. Basic policies will usually provide the minimum amount of coverage.

This minimum amount is set by the state, and will typically cover the damage caused in a minor or moderate auto accident. People who cause a severe accident, however, are often surprised when they find out afterwards that the damages exceeded their coverage limit.

Look carefully at where the coverage limits are set on each policy. A general rule is to try to match the maximum coverage amount to the total amount of assets owned by the driver. This is not necessarily the best rule to follow for everyone, however. When comparing policies, look for ones that will provide the most coverage for as little money as possible.

3. What perks and restrictions are on the policy?

This is probably one of the hardest areas to compare policies, yet it can make a huge difference in which policy a driver will ultimately choose. There are a variety of auto insurance discounts offered by companies. For example, some policies will automatically cover small windshield repairs for free. Other companies offer deals such as deep discounts on deductibles for good drivers.

Different types of auto insurance will also have a lot of different restrictions. For example, some policies will not cover a driver other than one that is specifically mentioned on the policy paperwork. This means that anyone who lends their car to a friend or relative may find themselves without auto insurance if that person gets into an auto accident.

Since there are so many different perks and restrictions, the best way to compare them is to make a list of all of them. Cross out the ones that will not be used or that do not apply. Then, consider each perk or restriction on its own merits. If possible, try to assign a dollar value to each perk. For example, if a driver routinely has to repair windshield chips once a year at the cost of $80, subtract this amount from the cost of the policy in order to compare it to other policies.

4. What is the deductible on the policy?

The deductible on a policy is how much a driver will have to pay out of pocket before his or her insurance company will start to cover the bills. In general, policies with higher deductibles will have lower premiums. While the amount of the deductible is not a high priority for some people, there are a lot of people who need to give this matter a lot of attention.

Having a low deductible is usually ideal for someone who does not have enough in savings to cover the damage from a minor accident. Because it can raise a premium, however, many people who can benefit from having a low deductible choose to go with a high one.

When comparing policies, look at how much more it costs to have a lower deductible and consider its effect on the household’s budget. Consider if it will be possible to keep the amount of a higher deductible in savings just in case something does happen.

5. What is the insurance company’s reputation?

With the opening of the auto insurance market there have been a lot of new start-ups. While many of these companies offer high quality policies, some of them have had problems. Check out any potential insurance company with business rating websites. Any company that is rated poorly, even if it has cheap insurance, should be dropped from consideration.

Be sure to carefully compare all potential insurance policies before making a decision on which one to buy. Simply going with the lowest cost insurance is not always the right decision. Be sure to enter your ZIP code into the FREE comparison tool below now!