How to Compare Auto Insurance

Insurance providers offer several plans to cover your auto insurance needs. It is important that you select a policy that fits your individual needs closely with your budget. You can compare different insurance plans based on your age, driving history, your current location and the type of car you drive. Here are some steps in the right direction.

Difficulty: Moderately Easy

Instructions

1. Go online and search for companies offering auto insurance. There are several sites that provide information about the various providers. Find out about the kind of coverage and premium on these sites or talk to your local agents and get quotes for several policy types.

2. Compare the prices for similar coverage offered by several insurance companies. Keep in mind that the cheapest insurance is not necessarily the best. However, the less it costs you to get a policy the better you may feel owning and driving a car.

3. Understand the kind of coverage available for your car. Insurance companies offer different plans with specific names. The most common of these policies are liability, collision, comprehensive, medical, uninsured and underinsured motorist, personal injury protection (PIP) and rental reimbursement.

4. Check for exclusions in each insurance plan. Upon receiving a number of quotes, you can compare each for exclusions or special clauses to determine which quote is best.

5. Look for limits on each kind of coverage. Limits may vary depending on the insurance provider, state and city of your residence and most importantly the car you are insuring.

6. Be flexible with deductibles on your policy. Ask how your premium will be worked out if you choose a higher or lower deductible.

7. Look at policies based on the ratings of the insurance companies to get an "apples to apples" feel for the comparison.

8. Ask the local agents about discounts for a good driving history and no claims. Choose the company that considers these factors and offers higher discounts with adequate coverage.

Tips & Warnings

• Adding other members of your family to a single policy will affect your premium rates. Make sure you finalize the type of policy and the number of people to include before buying the policy.
• Make your comparisons based on annual policies. A short-term or six month policy may have different sets of criteria and rates.
• Each carrier has promotional offers for limited periods so be careful not to use old comparisons. Ideally, you should shop for best rates every six months and be prepared to switch. Sometimes renewing a policy with the same company may prove expensive. Make sure you revise and update your comparisons regularly.